Why use credit cards? Other payment options, like debit cards and cash, may seem like an easier way to stay within budget. After all, credit cards have a reputation for encouraging you to spend money you don’t have — especially when enticing offers come in the mail.
But here at Money Under 30, we think a good credit card is a must-have. When used responsibly, credit cards can be great for your financial well-being. In fact, smart credit card holders can earn money just by using their card.
So, what are the benefits of credit cards over cash, and how can using one help you come out ahead?
What’s Ahead:
1. They build credit history
Perhaps the most important reason to have a credit card is to build credit history.
You can get a credit card no matter what your current credit score and then use it to build credit. Even if your credit score is low you can always start with a secured card. This makes credit cards a great place for anyone to start building credit.
A good credit score is essential if you plan to borrow money. These scores come partially from your credit card usage. Using credit cards responsibly can help in building credit.
When you pay at least your minimum payment by the due date the bank reports that to your credit file. When you want to borrow money in the future, creditors can see that you have a history of paying your debts on time. And the longer you use credit cards, the more you’ll build your credit history, improving your score even more.
Read more: How credit works
2. They offer rewards programs
One of the biggest credit card benefits are the rewards you can earn. There are almost as many rewards programs as there are credit cards. The trick is to find a rewards program that fits with spending habits you already have. This allows you to earn rewards on your everyday purchases without having to change your spending habits.
You’ll also want to find a rewards program that gives you rewards you’ll actually use. While everyone can benefit from a cash back credit card, you may get more value from a travel rewards credit card. However, a travel rewards credit card is not much use if you don’t travel very much.
Rewards programs can include, but aren’t limited to:
Cash back cards: These credit cards give you cash back on your everyday purchases. Often they have bonus rewards for certain kinds of transactions, such as extra cash back on gas or groceries. You can typically redeem your rewards for statement credits or a check.
Read more: Best cash back credit cards
Points and miles travel rewards cards: These credit cards let you earn points and miles on your everyday purchases. Like cash back cards, you can earn bonus rewards in certain categories. You can redeem your rewards for free or discounted travel. One popular program is the Chase Ultimate Rewards program.
Hotel or airline specific cards: These credit cards allow you to rack up rewards at specific hotels or airlines. While these credit cards can get you big discounts on travel, they are not as flexible as general travel rewards credit cards.
Many rewards credit cards have annual fees. Make sure that the rewards outweigh the annual fee before you sign up.
Read more: Best rewards credit cards
3. They may come with welcome bonuses
Many cards offer welcome bonuses for signing up. These could include perks like bonus miles/points that you can redeem for air travel or hotel stays, or bonus cash back that you can use as a statement credit.
Usually, you have to spend a certain amount on the card within a certain time period to get the one time bonus, so read the fine print. But it’s still an invaluable perk.
Read more: Best credit card sign-up offers
4. They protect against fraud
One of the biggest credit card benefits over debit cards is the level of fraud protection they offer.
Say your credit card is stolen or someone finds your card information online. If the thief starts making purchases, they aren’t spending your actual money. Unlike when someone steals your debit card.
Once you notify the card company of the theft, they’ll put a hold on your card and investigate. You aren’t liable for any fraudulent purchases made in the meantime. Federal law protections for credit card holders keep you from losing cash. Legally, the most you’ll potentially be liable for is $50, but I’ve never heard of a bank actually holding to that. Most, if not all, credit card issuers have a zero-liability fraud policy, you won’t lose anything.
Now say your debit card is stolen. Since debit card funds are instantly deducted from your checking account, any money spent on unauthorized charges will be gone. Automatic payments you’ve scheduled might overdraft as a result. If you report the theft within 60 days, the transactions can be reversed and the money restored. But this takes time and can be much more disruptive than a credit card theft.
Read more: The 5 biggest debit card dangers
5. Balance transfers let you move your debt to a lower rate
Often time, credit card welcome bonuses include a period of time with 0%, which typically includes balance transfers.
Balance transfers allow you to move your debt from one credit card to another. Other debts, like car loans and monthly installment payments, can also be moved to a balance transfer credit card. Keep in mind there is often a balance transfer fee when you do this – 5% is a common fee for balance transfers.
Now, this doesn’t mean you wipe out the debt. You’ll still have to pay what you owe, of course. However, the 0% APR for the first year will make it easier to pay off what you owe since all the money you’re putting towards it goes against the debt, which will save money on interest charges.
How much you can transfer to your new credit card will depend on your credit line. And if you keep adding more charges to the card, then you’re going to struggle to pay off the debt, even with 0% interest.
But if you do them responsibly, balance transfers can consolidate your debt, lower your interest payments, and make your life easier.
Read more: Best balance transfer credit cards
6. They may come with purchase protection
Consumer protection is a huge perk of many credit cards. If you buy an item with a credit card and later find out it’s damaged or the quality is poor, you can return the item and a statement credit for the amount of the purchase price. It may also cover you if the item is lost or stolen.
Credit cards may also offer extended warranties on electronics, furniture, and other items you hope to use for a long time. In many cases the card doubles the time on the manufacturer’s warranty. Make sure to keep your receipts!
Read more: Best credit cards with extended warranty protection
7. They have built-in grace periods
Essentially, credit cards offer a zero-interest loan for 30 days or less. Unlike debit cards, credit cards don’t require you to have the funds for a purchase immediately. There’s a grace period for you to make payment arrangements.
This grace period is the time between the end of a billing cycle and the day your payment is due (30 days). During this period, you will not receive interest charges to your balance. But you must pay the balance in full by the due date. If you don’t, then all the accrued interest will apply to your account.
Use this grace period wisely. Even if you pay the bill on time, but not in full, or if you pay it off in full, but not on time, then the interest-free grace period is over.
Read more: How grace periods work (and how to make them work for you)
8. They track your spending for you
Want to budget better? Credit card statements are a built-in expense tracker. Your purchases get recorded online with all the essential information — where, when, how much, and how often you’re spending. Some credit card companies keep your spending records around for years.
This benefit becomes especially useful come tax time. With one record of the past year’s spending already compiled, you’ll save time and effort on your taxes. Business expenses, rental property expenses, charity contributions, and more tricky tax return areas all show up on a credit card bill.
Read more: How to budget using credit cards
9. They tack on insurance
Check out the consumer protections offered with your credit card. Chances are you’ll find credit card benefits you didn’t even know you had.
In addition to extended warranties and purchase protection, many cards offer return protection, rental car insurance, and travel insurance.
Travel reward credit cards are known for providing some pretty sweet travel insurance perks. For example, several Chase credit cards offer primary rental car insurance. Meaning that you can decline the rental car insurance at the counter and use the insurance provided by your credit card instead – without having to involve your personal car insurance company if you need to make a claim.
Many credit cards also offer trip cancelation or interruption insurance. This means that if you have to cut your trip short, or cancel it completely, you’ll get reimbursed for your costs. Of course, the trip needs to be canceled or interrupted due to covered events, such as illness or injury.
Read more: Is it worth it to get a credit card just for the insurance benefits?
10. They’re universally accepted
Speaking of travel, your credit card is your best friend when you’re traveling. Accommodations and rental cars are much easier to book with credit than debit. Rental services generally place a hold of a few hundred dollars on your card. This hold can be inconvenient with a debit card.
Credit cards are also more readily accepted than debit cards worldwide. If you’re traveling to a foreign country, plan to use the lower exchange rates on your credit card instead of paying high exchange rates for cash at airports. Keep in mind that many credit cards charge foreign transaction fees – however not all do, so check before travel.
Read more: Best credit cards for international travel
Disadvantages of using a credit card
While credit cards come with a lot of convenience and flexibility, there are some cons of credit cards that you need to be aware of as well, particularly if you’ve had a rocky payment history in the past.
High interest rates
It’s not uncommon for credit cards to come with an interest rate of 20% or even higher. That’s much higher than other forms of debt, like mortgages or car loans. It can quickly add up and lead you into debt if you don’t pay off your balance each month.
When you carry a balance from one month to the next, you accrue interest charges on the unpaid balance. This leads to an accumulation of debt over time and makes it challenging for you to pay it off.
Potential for overspending
For some people, using a credit card doesn’t feel like “real” money. So it’s easier to lose track of your spending if you’re undisciplined, which can lead to a surprise balance at the end of the month.
Overspending is a common disadvantage of using a credit card. You aren’t limited by the amount of money you have available in your bank account, only by your credit limit. This can lead to the temptation to overspend and accumulate debt that might be hard to pay off in the future.
Credit card issuers often provide incentives, like cash back rewards or points, to encourage users to spend more with their credit cards. These credit card rewards can be enticing and might lead to impulsive purchases that aren’t necessary or within your budget.
Annual fees
Some credit cards charge an annual fee, which can be as much as several hundred dollars per year. These fees can add up quickly, especially if you’ve got multiple credit cards.
If the annual fees don’t outweigh the credit card benefits then you’ll want to start looking for another credit card. If you don’t travel very much then travel rewards can be difficult to redeem. Travel rewards credit cards also tend to have the highest annual fees.
If you find yourself in this situation then look for a rewards card with more straightforward rewards.
Read more: Is an annual fee credit card ever worth it?
Incentives and rewards can have conditions
Credit card issuers offer incentives and rewards to entice people to apply. But sometimes there are caveats that make it difficult to take full advantage of the rewards.
For example, a credit card may advertise up to 5% cash back, but if you read the fine print it’s only on certain rewards categories or up to certain spending limits.
Another common condition is to have rotating rewards categories. Each quarter the categories you can earn rewards in changes and you need to register each quarter to qualify for the extra cash back or bonus points. It’s easy to forget to register or the bonus categories aren’t always going to fit into your spending habits.
Irresponsible use can damage your credit score
Irresponsible use of a credit card can damage your credit score. Late payments, high balances, and maxing out cards are all reported on your credit file and can all negatively impact your credit report. This can have long-term consequences.
A low credit score can make it hard to get credit in the future, especially for large items like buying a house or a new car.
How to find the best credit card for you
There’s no one-size-fits-all solution when it comes to credit cards. Finding the card that’s right for you will depend on various factors such as your credit history, if you want travel perks or cash back, if you are looking to consolidate your debt with balance transfers, or a variety of other factors.
For example, you might prioritize a card that has no annual fee. Or you might be after a card with a good welcome bonus.
It’s a good idea to carefully examine how, and how much, you spend to figure out the rewards card that makes the most sense for you.
MoneyUnder30’s credit card comparison tool can help you quickly narrow down the cards that meet your criteria. Check it out today! Then you can read our reviews to see the pros and cons of each card and make an informed decision.
Summary
Credit card benefits include rewards, protection, and convenience, as well as regular reporting to the credit bureaus, which builds your credit.
The key is to be smart with your card and pay it off each month. Doing that can actually save money and keep you protected from unauthorized purchases. And, depending on which card you choose, you’ll have some nice perks thrown in as well. Just watch those annual fees.
From the casinos of Las Vegas to the hot springs of Reno, Nevada has plenty to offer both residents and visitors. The best banks in Nevada offer high interest rates and fee-free basic savings account and checking account options.
12 Best Banks in Nevada
If you’re in the market for a new bank, there are more than a few options available. The below list will help you find a bank account that fits your needs.
1. Chase Bank
There are quite a few national banks in Nevada, including Chase, which has both branches and ATMs in the state. Chase’s signature checking account, Total Checking, waives the monthly fee as long as you receive $500 or more in direct deposits or maintain a $1,500 balance.
But perhaps the best reason to move your Nevada banking to Chase is the $200 bonus if you open a new checking account and enroll in direct deposit.
Fees:
$12 monthly service fees (waived with requirements)
$34 overdraft fee
Balance requirements:
No minimum deposit to open
No minimum balance requirements
ATMs:
Fee-free at 15,000+ Chase Bank ATMs
$3-$5 for each out-of-network ATM transaction
Interest on balance:
0.01% APY on savings account
Up to 3.75% APY on CDs
Additional perks:
$200 bonus for new checking accounts
Chase Overdraft Assist gives you extra time to fix overdrafts
2. Nevada State Bank
For a local bank option, check out Nevada State Bank, which is part of Zions Bancorporation, N.A. Your Nevada State Bank debit card gets you fee-free ATM access at both Nevada State Bank and Zions Bancorporation locations.
Nevada State Bank offers a free checking account as long as you have at least $250 in electronic deposits monthly or make at least 10 debit card purchases using your Nevada State Bank debit card.
Fees:
$9 monthly maintenance fee (waived with requirements)
$29 overdraft fee
Balance requirements:
$50 minimum deposit to open
ATMs:
Fee-free at any Nevada State Bank or Zions Bancorporation ATM
$2.50 fee for each out-of-network ATM transaction
Interest on balance:
0.01% APY on savings accounts
Up to 4.75% APY on CDs
Additional perks:
Military checking accounts available
Wide range of loan options available
3. Chime
Chime is an online and mobile banking option, which offers a fee-free checking account and 2.00% APY on its savings accounts. You’ll have access to cash at more than 60,000 ATMs nationwide. This is an option that works best if you have direct deposit set up, since most of Chime’s perks require it.
Fees:
No monthly service fees
No overdraft fees
Balance requirements:
No minimum deposit to open
No minimum balance required
ATMs:
Fee-free at more than 60,000 ATMs nationwide
$2.50 out-of-network ATM transaction fee
Interest on balance:
2.00% APY on savings account
Additional perks:
Access to paycheck up to two days early
SpotMe covers you in up to $200 in overdrafts
4. Zions Bank
Zions Bank is a regional bank with branches in Nevada, as well as in Arizona, California, Colorado, Idaho, New Mexico, Oregon, Texas, Utah, Washington, and Wyoming. Like most banks, Zions Bank offers features like mobile check deposit and online bill pay. You’ll find ATMs throughout Nebraska, as well as across its service area.
Fees:
No monthly service fees
$29 overdraft fee
Balance requirements:
$50 minimum deposit to open
No minimum balance required
ATMs:
Fee-free at any Zions Bancorporation ATM
$2.50 for each out-of-network ATM transaction
Interest on balance:
Up to 0.19% APY on savings accounts
Up to 5.20% APY on CDs
Up to 1.46% APY on money market account
Additional perks:
Robust mobile banking features
Great banking options for small business owners
5. GO2bank
Online-only banks can be among the best banks in Nevada, thanks to their competitive offerings. GO2bank is one of those banks. You’ll get 4.50% APY on your savings account, as well as 7% cash back on gift card purchases.
All you’ll need to do to qualify for the free checking account is to have at least one government or payroll direct deposit in the previous statement period.
Fees:
$5 monthly fee (waived with requirements)
$15 overdraft fee
Balance requirements:
No minimum deposit to open
No minimum balance required
ATMs:
Fee-free at Allpoint ATMs nationwide
$3 for each out-0f-network ATM transaction
Interest on balance:
4.50% APY on savings accounts
Additional perks:
Deposit cash at more than 90,000 retailers nationwide
Up to 7% cash back on gift card purchases
6. Bank of America
Bank of America is a national bank with branches in 38 states, including Nevada. Debit cards work at ATMs throughout its service area, including throughout Nevada.
Advantage Plus checking accounts are fee-free as long as you have at least one electronic deposit of $250 or more, maintain a $1,500 minimum balance, or are enrolled in Preferred Rewards.
Fees:
$12 monthly service fee (waived with requirements)
No overdraft fees
Balance requirements:
$100 minimum deposit to open
ATMs:
Fee-free at 15,000+ Bank of America ATMs nationwide
$5 for each out-of-network ATM transaction
Interest on balance:
Up to 0.04% APY on savings account
Up to 4.75% APY on CDs
Additional perks:
Generous bonuses on new credit cards
Wealth management services available
7. One Nevada Credit Union
If you live, work, or attend church or school in Clark, Nye, or Washoe County, you’ll qualify for membership at One Nevada. Credit unions typically come with plenty of perks, including competitive rates on loans.
The One Checking Account comes with a $5 fee that can be waived as long as you maintain a $2,000 average daily balance or have at least 15 signature-based debit purchases each month.
Fees:
$5 monthly service fee (waived with requirements)
$35 overdraft fee
Balance requirements:
$5 membership fee to open
ATMs:
Fee-free at One Nevada Credit Union ATMs
Fee-free at 46,000+ Allpoint ATMs nationwide
Interest on balance:
0.05% APY on savings account
Up to 4.59% APY on CDs
Additional perks:
Dividends paid monthly on One savings account
Competitive rates on personal loans
8. CIT Bank
CIT Bank is an online and mobile banking solution that offers a no-fee checking account. A $100 minimum opening deposit is required, but there are no fees for overdrafts.
Although CIT doesn’t have an ATM network, there are no out-of-network ATM fees, and CIT will even refund up to $30 in fees charged by third-party ATM owners every month.
Fees:
No monthly maintenance fees
No fees for overdrafts
Balance requirements:
$100 minimum opening deposit
No minimum balance required
ATMs:
Up to $30 in out-of-network ATM fees reimbursed monthly
Interest on balance:
Up to 0.25% APY on checking accounts
Up to 4.736% APY on savings accounts
Up to 5.00% APY on CDs
Up to 1.538% APY on money market accounts
Additional perks:
Competitive rates on financing for small business owners
Competitive rates on no-penalty CDs.
9. Wells Fargo
Another national bank in Nevada is Wells Fargo, which has branches in Las Vegas and Henderson. You can complete most of your transactions using the mobile banking app, but you’ll also have fee-free ATM access at 12,000 ATMs nationwide.
You’ll get a free checking account as long as you maintain a $500 minimum balance or receive $500 or more in qualifying direct deposits each statement period.
Fees:
$10 monthly service fee (waived with requirements)
$35 overdraft fee
Balance requirements:
$25 minimum deposit to open
No minimum balance requirement
ATMs:
Fee-free at Wells Fargo ATMs nationwide
$2.50 fee for each out-of-network ATM transaction
Interest on balance:
Up to 0.25% APY on savings account
Up to 4.51% APY on CDs
Additional perks:
$300 bonus for new checking accounts
Robust mobile banking services
10. WaFd Bank
WaFd Bank is a regional bank with branches in Nevada, Arizona, Idaho, New Mexico, Oregon, Texas, Utah, and Washington. You’ll have access to more than 200 branches throughout those states, as well as ATM access at MoneyPass locations nationwide.
What makes WaFd Bank the best regional bank is its local bank feel. The bank focuses on providing a sense of community in each area it serves.
Fees:
No monthly maintenance fees
$30 overdraft fee
Balance requirements:
$25 minimum opening deposit
No minimum daily balance requirement
ATMs:
Fee-free at 32,000+ MoneyPass ATMs nationwide
Interest on balance:
0.10% APY on savings account
Up to 5.00% APY on CD
Up to 2.00% APY on money market account
Additional perks:
Three styles of debit cards
Budgeting and financial management tools in mobile banking app
11. First Foundation Bank
Another regional bank with branches in Nevada is First Foundation Bank. There are multiple checking account options, including a free account that requires a $100 opening deposit.
There’s no national ATM presence, but First Foundation does reimburse up to $20 in third-party ATM fees monthly. What makes First Foundation the best regional bank, though, is its above-average rates on savings accounts. You’ll earn 4.85% APY on your savings account balance.
Fees:
No monthly maintenance fees
$35 overdraft fee (after $10 grace amount)
Balance requirements:
$100 minimum opening deposit
No minimum daily balance requirement
ATMs:
Fee-free at First Foundation Bank ATMs
Up to $20 in third-party ATM fees reimbursed monthly
Interest on balance:
4.85% APY on savings account
Up to 4.75% APY on CD
Additional perks:
Wealth management services available
Robust solutions for small business owners
12. Plumas Bank
Plumas Bank is a local bank covering Northeastern California and Northern Nevada. You’ll find competitive rates on CDs and multiple checking account options. The basic checking account comes with no monthly fees as long as you conduct 10 or more signature-based transactions using your debit card and enroll in e-statements.
Fees:
$7 monthly service fee (waived with requirement)
$34 overdraft fee
Balance requirements:
$100 minimum opening deposit
No minimum daily balance required
ATMs:
Fee-free at ATMs with the VISA, STAR, and PLUS symbols
$2 out-of-network ATM fee
Interest on balance:
0.10% APY on savings account
Up to 4.08% APY on CD
Additional perks:
Robust services for small business owners
Highly rated customer service
How to Choose the Best Bank for Your Needs
Whether you’re looking for a small local bank like Nevada State Bank or you’d prefer a large national bank like Bank of America, it’s important to look at the features. Here are some things to consider for your personal or business checking account and savings needs.
Selection of Products and Services
There’s more to a financial institution than fees and interest rates. The best banks in Nevada provide the type of customer service you need, coupled with a range of services.
If most of your banking is done electronically, online banking might be the best choice for you. If you regularly make cash deposits and withdrawals, though, a local bank with branches close to your house could make a bigger difference.
Before signing on with a bank, take a look at the products offered. Some banks and credit unions provide great interest rates on auto loans if you’re already a customer, so having that as an option could save you money later.
Personal, Business, or Both?
To start, take a close look at what you need in a bank account. Even if you don’t run your own business now, will you someday? If so, business banking services are worth consideration. Landing business loans might be easier if you already have a personal or business checking account with a bank.
Interest Rates
There are two ways interest rates impact you when you’re researching the best banks in Nevada. Deposit accounts like checking and savings earn interest, while loans and credit cards charge interest.
Some checking accounts pay interest but charge fees that supersede any earnings. Some banks offer competitive rates on CDs and savings, but the deals on loans and credit cards aren’t as good. There’s always the option of having multiple bank accounts, but if you prefer to do all your banking in one place, it’s important to consider these factors.
Minimum Balance
Some accounts have a minimum balance requirement attached to their personal checking account options. The best checking account will give you the freedom you need to deposit and transfer money without having you stress about your balance.
It’s also important to note the wording of those balances. In some cases, your personal checking will simply need to keep an average daily balance to meet requirements. Some of the best checking accounts also consider your balance across all your accounts rather than setting a requirement for each. If you have two checking accounts or a checking and savings account with the same bank, you’ll be able to more easily meet that requirement.
Access to Mobile Banking
Online banking makes managing your money easy. Whether you narrow your search to online banks or you’re looking for the best national bank, chances are, you’ll be able to manage your account online.
The best checking account lets you transfer funds, deposit checks, and manage your payment cards in an app. Take a close look at any bank’s app to make sure you’ll be able to handle most of your account online if you prefer to steer clear of branches and ATMs. If you go with an online-only bank, though, make sure you’ll have access to cash when you need it, especially while traveling.
The largest banks in Nevada might not have the features you need. Before choosing a bank, make sure the bank offers the best features for you while also reducing fees and maximizing interest.
If you’re looking for the most affordable way to go to Disney World, Disneyland or on a Disney Cruise, you may have wondered if Disney’s credit card offerings, the Disney Visa Card and the Disney Premier Visa Card, are good options.
Both earn Disney Rewards Dollars that you can use to pay for most things Disney, including trips to the parks or a cruise. And, after all, anything that makes a Disney trip more affordable can be a very good thing to consider.
But the answer to whether or not the cards are worth it is a little more complicated than a simple yes or no. We’ll break down how the cards work and when they are — and aren’t — worth getting in anticipation of an upcoming Disney vacation.
Disney Visa card welcome offers
The Disney Visa is the entry-level product that has no annual fee and currently awards a $150 bonus after you spend $500 on purchases in the first three months. The Disney Visa Premier has a $49 annual fee, but currently awards a $300 statement credit after $1,000 in spending in the first three months. Both are issued by Chase and thus are subject to Chase 5/24 rules.
I’m not one to turn down $150 to $300 in statement credits, but remember that several credit cards have sign-up bonuses worth $1,000 or more.
Just as an example of what else is out there, the Capital One Venture Rewards Credit Card is currently offering 75,000 bonus miles after you spend $4,000 total on purchases within the first three months from account opening, and the Chase Sapphire Preferred Card has a bonus of 60,000 bonus points after you spend $4,000 on purchases in the first three months from account opening.
So while $300 toward a Disney vacation sounds great (and it can be) — it’s good to compare to the value of other cards.
Related: How much does it cost to go to Disney World?
Disney Visa card rewards
Now that we’ve discussed the bonuses, when you look at everyday spending, the Disney credit cards earn rewards at different rates.
Sign up for our daily newsletter
The no-annual-fee Disney Visa earns a simple 1% back on all card purchases in the form of Disney Rewards Dollars you can use at Disney. The Disney Visa Premier, meanwhile, earns 5% back on card purchases made directly at DisneyPlus.com, Hulu.com or ESPNPlus.com, 2% back on purchases at gas stations, grocery stores, restaurants and most Disney locations, and 1% back everywhere else.
Disney Rewards Dollars are extremely limited — they’re only good for use at Disney locations With the Premier, you can also redeem your dollars for a statement credit toward airline travel, but it’s likely that there are still better options out there for you. Earning up to 5% back in Disney Rewards Dollars in some spending categories isn’t bad, but just for perspective, there are many credit cards out there that provide a better return for everyday spending than either of the Disney cards.
For example, the Capital One Venture earns 2 miles per dollar spent on all purchases, albeit for a higher annual fee of $95 per year. Some credit cards award up to 4 or 5 points per dollar at places such as grocery stores and on gas purchases, travel purchases, etc.
In other words, you can do much better than earning Disney Reward Dollars with your everyday purchases via a wide variety of credit cards.
Related: Earn more than 1 point per dollar with these cards
Disney Visa card perks
The unique perks are where the Disney Visa products get more interesting for those looking to vacation with Mickey Mouse.
First, you can save 10% on some Disney merchandise purchases of $50 or more and save 10% on select dining locations on eligible dates at Disneyland and Disney World. Some eligible spots include: Skipper Canteen at the Magic Kingdom, Rose & Crown Dining Room (lunch only) at Epcot, Kona Cafe at the Polynesian Village Resort, the Hollywood Brown Derby at Hollywood Studios and Storytellers Cafe at the Grand Californian at Disneyland (I highly recommend the breakfast with characters at Storytellers).
Related: Best restaurants at Disney World
You can also get a 10% discount on some activities, such as the horseback rides at Fort Wilderness. Finally, Disney card members also get some exclusive photo opportunities.
Related: Is Disney Cruise concierge level worth it?
Why the Disney debit card may be better
At TPG, we aren’t huge fans of using debit cards for everyday purchases, as you typically don’t earn rewards or have the same level of built-in protections as with credit cards. That said, the Disney debit card may make sense if you’re mainly interested in the Disney perks that come by having the card.
Having the debit card won’t count against Chase 5/24 status and carries no annual fee. However, you will need a Chase checking account to access this debit card option.
The Disney debit card doesn’t earn rewards (so there is no need to really use it much), but it gets you access to many of the same photo ops and discounts on Disney merchandise, dining, cruise expenses, park tours, etc., as the Disney Visa credit cards. This is a way to get the perks but avoid fees or using a 5/24 slot on a Disney credit card.
Related: Why you shouldn’t use debit cards
Why the Disney Visa cards aren’t always the best choice
I’m a bit of a Disney fanatic, so I get the appeal of having one of these Disney cards — they’re cute, too, with the different available Disney design options. If the built-in perks — the in-park character photo ops and available discounts — sound intriguing, then a Disney Visa might be right for you since those are perks not really replicated on other cards.
If you are big on Disney dining and some out-of-park experiences, saving 10% or so on those charges can add up for frequent Disney visitors.
However, if your main goal is to get a rewards-earning credit card that will rack up points or rewards you can use toward a Disney vacation, you can probably do better both in terms of a larger welcome bonus and better everyday earning rates that you can use at Disney than a Disney Visa.
Here are my favorite credit cards for families who want to use perks to travel.
Related: How to use points for Disney tickets
If you spend a lot of money at Disney and want to earn as many points or as much cash back as possible on these expenses, the Disney Visa Premier is a good choice but not always.
Bottom line
The Disney Visa credit cards are fun rewards choices for fans of all things Disney. However, the cards are far from slam dunks for Disney enthusiasts looking to earn or use rewards for a Disney vacation in all situations.
In terms of rewards, the Disney cards are better than paying for things with checks or debit cards, but they often aren’t the absolute best credit cards on the market if your goal is to use points for your next Disney trip.
Instead, have read our guide to the best credit cards for Disney vacations to save the most money and earn maximum points on your ticket, flight and hotel expenses on your next Disney vacation.
Read more: Disney Premier Visa and Disney Visa card reviews
Indiana is a hub of industry, attracting households and businesses with its vast farmlands and thriving big cities. So, it’s only natural that a variety of banks have emerged, from branches of large national banks to small local banks.
The best banks in Indiana combine minimal checking account fees with competitive rates on savings and CDs. It’s also important to look for a bank that lets you manage your account online while also getting that in-person service when you need it.
18 Best Banks in Indiana
With so many banks in Indiana, it can be tough to narrow down the options. This list can help you get started.
1. U.S. Bank
U.S. Bank is a top choice for those seeking a blend of national reach and local presence in Indiana. With eight locations in the state, U.S. Bank offers convenient access to banking services, as well as a comprehensive suite of banking products.
One standout offering is the U.S. Bank Smartly Checking account, which is currently offering a $300 sign-up bonus to new customers. This account was designed to provide customers with a simple, low-cost banking experience.
Pros:
U.S. Bank Smartly Checking account offers no monthly maintenance fees and easy mobile banking
Eight convenient branch locations in Indiana
Access to over 32,000 fee-free ATMs nationwide
Cons:
Limited physical presence compared to some larger national banks
Higher-tier checking accounts may require minimum balances or direct deposits to avoid monthly fees
2. Chase Bank
If you prefer the power of a national bank, Chase is worth considering. In addition to online and mobile banking, Chase has branches and ATMs scattered across the state. You’ll find a wide variety of banking products, including savings accounts, personal and business banking, and wealth management services.
Pros:
ATM access at more than 15,000 ATMs and 4,700 branches nationwide
Sign-up bonuses on new checking accounts
No monthly service fees with direct deposit
Cons:
Only 0.01% APY on savings
$3-$5 fee for out-of-network ATM use
3. Fifth Third Bank
Fifth Third Bank is a regional bank with branches in 11 states, including Indiana. You can find fee-free checking accounts with Fifth Third, but savings rates are less competitive than some online and local banks.
Pros:
No fees or minimum balance on Preferred Checking
Student and military accounts available
Fee-free ATM use at more than 40,000 locations
Cons:
Lower rates on savings accounts
Branch locations tend to be near larger cities
4. Chime
Chime is an online bank that offers more conveniences than usual. Your checking account not only gives you fee-free cash access at more than 60,000 ATMs, but you can deposit cash at Walgreens and 75,000+ retail locations. You can manage the rest of your account online, and you’ll get no monthly fees or overdraft charges, as well as automatic savings features.
Pros:
Deposit cash at more than 90,000 retail locations
No overdraft fees
Credit-builder credit card available with no credit check required
Cons:
No in-person customer service available
Withdrawal limits can be low
5. GO2bank
Another online-only option with cash access is GO2bank, which allows fee-free ATM transactions at 43,000 AllPoint locations. You can also deposit cash at any CVS Pharmacy, Rite Aid, Walgreens, or Walmart. Checking accounts come with no monthly fees as long as you have at least one payment deposited directly each month. Direct deposit accounts are also eligible for up to $200 in overdraft protection.
Pros:
4.50% APY on savings account
Fee-free cash access at 43,000 AllPoint ATMs nationwide
Deposit cash at CVS Pharmacy, Rite Aid, Walgreens, or Walmart locations
Cons:
No in-person customer service available
Savings APY limited to first $5,000 of balance
Direct deposit required for fee-free checking
6. First Financial Bank
One of the best banks in Indiana is First Financial Bank, an Ohio-based bank with branches throughout Indiana, as well as in Illinois and Kentucky. You’ll get all the amenities of a national bank with the exceptional customer service that comes with banking locally. Some checking account options offer discounts on loans, and you’ll get rates of up to 4.50% on CDs.
Pros:
Local branches throughout Indiana
Fee-free ATM access at 55,000+ AllPoint locations
Interactive tellers provide personal service
Cons:
$25 overdraft fee
$10 monthly maintenance fees on checking (waived with $500 balance or debit card activity)
7. First Merchants Bank
First Merchants Bank is a local bank that primarily serves Central Indiana. But you’ll find branches as far north as Fort Wayne. First Merchants Bank has been voted one of the best banks in Indiana for its attention to customer service, community focus, and mobile banking features.
First Merchants Bank has a low barrier on its fee-free checking account, letting you qualify with only a $100 balance or at least one customer-initiated transaction each statement period.
Pros:
Free checking with $100 balance or one qualifying transaction monthly
Fee-free national access at 37,000 MoneyPass ATMs
Up to 4.75% APY on 12-month CDs
Cons:
Branches limited to Northern and Central Indiana
$37 overdraft fee per transaction
8. Huntington Bank
Although it’s a regional bank, Huntington Bank is headquartered in Columbus, Ohio, so Indiana was an easy fit for its expanded service area. One of Huntington’s premiere features applies to its overdrafts.
Deposit accounts qualify for 24-Hour Grace, which allows you extra time to take action if your account goes into the negative. But if you travel, be aware that Huntington’s ATM access is limited to its service area. You’ll pay $3.50 plus third-party fees for every out-of-network ATM transaction.
Pros:
24-Hour Grace allows extra time to resolve overdrafts
Fee-free ATM access at 1,434 Huntington locations
In-person service at branches throughout the service area
Cons:
$3.50 fee for out-of-network ATM transactions
Low savings account rates
9. CIT Bank
You won’t find local branches or ATMs, but CIT Bank is a great option for building savings. CIT’s Platinum Savings account offers up to 4.75% APY, and they have a no-penalty CD with rates as high as 4.80%.
Their eChecking product is impressive, as well, with no monthly maintenance fees and up to 0.25% APY on your balance. You can withdraw cash at any ATM and CIT will refund up to $30 in fees every month.
Pros:
Interest rates of up to 4.75% on savings
Great rates on no-penalty CDs
Up to $30 a month in ATM fee refunds
Cons:
No branches
No in-network ATMs
10. Centier Bank
Centier Bank is another local option considered one of the best banks in Indiana. Although it’s local, it’s certainly not small. In fact, it’s the largest family-owned bank in the state.
You’ll find branches from Fort Wayne to Indianapolis, as well as ATMs nationwide through the AllPoint and Publix Presto! networks. Savings rates pay as high as 5.00% APY when you connect your checking to your savings account.
Pros:
Up to 5.00% APY on savings account
Low monthly fees on checking accounts
Fee-free access to Centier, AllPoint, and Presto! ATMs
Cons:
$100 savings balance required to earn APY
$50 minimum opening balance
11. BMO Harris Bank
Indiana residents have access to BMO Harris Bank, a regional bank that also services Illinois, Arizona, Missouri, Minnesota, Kansas, Florida, and Wisconsin. You’ll find branches and ATMs across the state, with a heavy concentration in Indianapolis and Gary.
The savings account only offers 1.00% APY, but BMO’s CD rates are competitive, paying up to 4.50% APY. Currently, new BMO Harris customers can earn a $200 cash bonus on basic checking accounts and a $350 bonus on high-balance checking.
Pros:
Fee-free checking accounts
Fee-free access to more than 43,000 AllPoint ATMs
$200-$350 cash bonus for new customers
Cons:
Only 1.00% APY on savings account
$25 minimum opening deposit
12. 1st Source Bank
1st Source Bank is set up to serve banking customers in Northern Indiana and Southwestern Michigan, but it has a small presence in Florida as well. If you regularly travel and need cash, 1st Source Bank might not be the best option, as ATMs are limited to its service area. 1st Source will refund up to four ATM fees on their end each year, but you’ll still pay third-party ATM fees.
Pros:
Student checking option available
Offers Health Savings Accounts
Variety of loan options
Cons:
Branches are limited to Northern Indiana
Rates on CDs aren’t competitive
ATMs limited to Northern Indiana and Southwestern Michigan
13. Ally Bank
Another online and mobile banking option is Ally, which has an interest-bearing checking account that currently pays 0.25% APY and has no fees. You can withdraw cash at more than 43,000 AllPoint ATMs nationwide, and if you can’t find an AllPoint ATM nearby, Ally will reimburse up to $10 per statement cycle for out-of-network ATMs.
However, the best thing about Ally is its rates on savings accounts and CDs. Currently, Ally is offering up to 4.80% on CDs and up to 3.75% on your savings account.
Pros:
Great rates on CDs and savings
Fee-free access to more than 43,000 AllPoint ATMs
No fees or minimum balance requirements
Cons:
No physical branches
No cash deposit option
14. Old National Bank
With branches across Indiana, as well as in Michigan, Wisconsin, Minnesota, Kentucky and Illinois, Old National Bank is a great brick-and-mortar option. Although it’s a regional bank, Old National Bank has plenty of amenities found with national banks, including a full-featured mobile app and cash deposits at select ATMs.
Pros:
Some Old National ATMs accept cash deposits
Fee-free cash withdrawals at Old National and AllPoint ATMs nationwide
Student checking accounts available
Cons:
Savings account rates lower than some competitors
Direct deposits or minimum balance required for free checking accounts
15. First Bank
For Indiana’s small business owners, First Bank is a great local Indiana bank. First Bank serves Indiana and Illinois businesses with online and mobile banking options to help you manage everything.
You’ll find a variety of financial products for small business customers, including business loans, equipment financing, and cash management tools. One downside, though, is that it’s a completely online branch, but you’ll get fee-free cash access at more than 40,000 MoneyPass ATMs nationwide.
Pros:
No-fee checking options available
Great rates on business and equipment loans
Fee-free ATM use at 40,000+ MoneyPass locations
Cons:
No local branches
Only serves Evansville, Haubstadt, Mount Vernon, Poseyville, Princeton, and Vincennes businesses
16. Regions Bank
One of many regional banks with a heavy Indiana bank presence is Regions Bank. You’ll find branches throughout Indiana, as well as in Alabama, Arkansas, Florida, Georgia, Illinois, Iowa, Kentucky, Louisiana, Mississippi, Missouri, North Carolina, South Carolina, Tennessee, and Texas.
Regions Bank’s checking account lacks the amenities of some online-only and national banks, with a $1,500 balance required to eliminate the monthly maintenance fees.
Pros:
Earn rewards on savings and checking through Regions Cashback Rewards
User-friendly mobile banking experience
24/7 customer support
Cons:
$1,500 balance to qualify for free checking
Branches limited to service area
$3 transaction fee for non-Regions ATM
17. Community First Bank of Indiana
If wealth management services are your top priority, consider Community First Bank of Indiana, which offers financial assistance through a dedicated investment services team.
In addition to wealth management services, Community First Bank offers the personalized customer service that’s typical of a local bank. But if you regularly travel outside the area, note that Community First has no nationwide ATM network.
Pros:
Community focus with great customer service
Fee-free checking accounts
Dedicated investment support team available
Cons:
Only seven branch locations
Fee-free ATMs limited to seven branch locations
18. Bank of America
There are benefits to a national bank like Bank of America. Like most national banks, you’ll find branches and ATMs throughout Indiana, but with Bank of America, this is found in towns throughout the country. Bank of America also offers better-than-average rates on home equity loans and auto loans.
Pros:
Automatic savings options
Earn rewards with debit card
Large ATM and branch presence nationwide
Cons:
Minimum balance or direct deposit required for free checking account
Low interest rates on savings
Life can be busy. Managing your financial life can be much easier if you find a bank that fits your needs. Whether it’s a fee-free checking account or help to build your retirement accounts, the right bank can make all the difference.
Finding the Best Banks in Indiana
Whether you’re in the market for a personal checking account or business banking options, there are plenty of FDIC-insured banks in the state. To help you narrow down your options, here are some questions to ask yourself.
How often do you visit your bank right now?
As you’re browsing a list of banks in Indiana, you probably know right away which ones have branches near you. Are you the type of person who visits your local branch frequently? Even the best checking accounts won’t benefit you if you prefer that in-person experience and your new bank doesn’t offer it.
How well do you handle online communication?
Some online, national, and regional banks offer customer service via text chat, video chat, or telephone. If this is sufficient, you’ll likely find your options up open considerably. You may choose an online bank for your checking account while you go with a bank that has a local branch for personal loans.
How often do you need cash?
Some of the smaller banks in Indiana fall short when it comes to ATM access. Having a no-fee checking account but paying $30 monthly in out-of-network ATM fees isn’t ideal. You may be better off going with a bank that charges fees, but gives you fee-free access to cash when you need it.
When you see an advertisement for a “free” business checking account, most of the time it’s not entirely “free.” After all, for these banks to stay in business, they have to make money off of you somehow!
A top priority in our list was to include banks that offered competitive business checking accounts for freelancers, small business owners, entrepreneurs, and growing businesses. Business checking accounts typically won’t provide account holders with an opportunity to earn interest and they’ll charge slightly higher fees, so our list focuses on those banks that keep their fees to a minimum and also highlights some that offer interest.
Even so, it’s important to always read the fine print before signing up for a new checking account. Here are the most important features to consider in a business checking account:
Balance and deposit requirements
Some banks charge a monthly fee if your business checking account’s balance falls below a certain threshold. It’s calculated on an average, by day, so as long as you’re maintaining a certain level of money in the account you should be fine. A bank may also require a minimum initial deposit, which may disqualify you from opening the account if you don’t have the money available.
On the flip side, some banks will actually reward you for having a high balance, much like they do with a personal checking or savings account (typically a higher interest rate). With business checking accounts, you may get a higher interest rate or even a reduction (or elimination) of some fees by carrying a large balance.
If you don’t see anything in the fine print about high-balance bonuses, then contact a service representative to see if they’re willing to give you a break if you agree to keep your balance above a certain amount.
Monthly maintenance fees
Monthly maintenance fees don’t exist with every business checking account. And those that do require a monthly fee may offer account holders an opportunity to waive the fee (typically by maintaining a minimum account balance). On average, these fees are typically $10-$15, but in some cases, they can jump as high as $50.
Before you sign up for a business checking account, confirm if there’s a monthly maintenance fee. If there is, see if there is an option to waive the fee by maintaining a minimum account balance or ask to have the fee waived.
Monthly transaction limits
With a business checking account, most banks will put a limit on the number of transactions you make every month. Seems kind of backward, doesn’t it? With a personal checking account, you’re often encouraged to make unlimited transactions, not limit them.
Limits placed on account transactions also don’t apply to just debit card charges. It usually includes things like deposits (both check and cash), withdrawals, checks written, and payments you make electronically.
Most banks will put a limit of up to 500 transactions, depending on the bank. On average, though, you typically won’t see a limit below 100 transactions per month. Expect the fees to be as high as 50 cents per transaction over the stated limit. That’s like a 25% surcharge on a $2.50 coffee.
It is possible to find unlimited transactions with a business account, but not easily. Some banks may offer an unlimited transactions option for a higher monthly fee, or you could find a bank that doesn’t have a limit on transactions at all. However, you’ll likely have to pay a higher monthly fee if you go that route. Alternatively, you could keep track of your transactions and stay below the allotted amount each month to avoid paying any monthly fee requirements.
What are the benefits of having a business checking account?
1. It keeps your personal and business finances separate
While technically (and legally), you can use a personal bank for your small business, it isn’t recommended.
That’s because mixing the two can make it difficult to track your income and expenses. And if you accidentally pay personal expenses from a business account, those expenses are subject to taxes and can convolute your books.
It’s best to have a separate, business-only bank account where you can do all of your business banking and ensure it’s kept separate from your personal finances.
Read more: How to separate your personal and business finances (and why you should)
2. It can help you manage your cash flow more effectively
Cash flow is the lifeblood of any business. If you can’t manage your cash flow effectively, your business will inevitably fail. That’s why finding the best business checking accounts is so important — so you can keep track of your incoming and outgoing cash. With these checking accounts, you can easily track your expenses and income, which can also help you get a loan for your business, if needed.
3. It can help you build business credit
One of the most important things you can do for your business is build credit. When you have good business credit, you’ll have a better chance of qualifying for a loan or line of credit should you ever need them. It can also help you get better terms on those loans.
One of the best ways to build business credit is to open a business bank account. When you have a business bank account, it shows that you’re a legitimate business and helps build your credit history. If you’re thinking about opening a checking account, make sure you choose a bank that reports to the major credit bureaus, so you can build your business credit history every time you make a deposit.
Read more: How to build and establish business credit
4. It can offer additional perks, such as rewards programs or interest-earning potential
The best business checking accounts will also often offer additional perks that can help your business. For example, some banks offer rewards programs that give you cash back or points for every purchase you make. Others may offer interest-bearing accounts, which can help you earn money on your deposited funds.
What do you need to open a small business checking account?
There are a few requirements you’ll need to open a business checking account, which may (or may not) include:
A business license or incorporation documents – The business account will need to be opened in the name of your business. This is why it’s important to have your business license or incorporation documents handy.
Your Employer Identification Number (EIN) – Your EIN is a nine-digit number that is assigned to a business, also known as a federal identification number.
A government-issued ID – Your driver’s license will typically meet this requirement.
The bottom line
It shouldn’t matter if you’re an established small business or a brand new blog. If you have a business, you’re a business owner. As such, you should find one of the best business checking accounts on the market to keep your personal and professional finances separate.
Every business has different needs, and every bank account offers different services and features to meet those needs. Before you sign up for a business checking account, be sure to do your research. Look for details like fees and transaction limits. See if you can find an account that offers interest or cash back. Consider multiple options to make sure you find the account that best suits your business.
Featured image: Cast Of Thousands/Shutterstock.com
Closing a bank account and opening a new one can be tricky.
Banks like to keep customers, so they make the closing process complicated.
The “hassle factor,” or the million-and-one little things you have to do before a task is complete, is one of the biggest reasons people don’t switch banks. Another reason is that people don’t feel like they know enough about other account options.
Breaking the process down into steps can help. Overall, it’s easier than you think. And the savings, in money or convenience, will usually be worth it.
Follow the three steps and you’ll be able to switch banks with as little stress as possible.
What’s Ahead:
1. Find a new bank account first
Open the new account before closing the old one. That way your automatic transactions can continue smoothly without a gap in between.
If you haven’t already picked a new bank, do some research on different banks’ requirements, perks, and fees. Here’s what you want to look for:
Services the new bank offers that your old one doesn’t. These could be simple tweaks, like an easier-to-use mobile app, or major financial services like CDs and retirement accounts.
Interest rates. If you’re switching savings accounts, compare the interest rate you’re getting on your current account versus what you might get with a new account. Some banks offer interest-bearing checking accounts, too.
The convenience factor. Can you navigate the new bank’s website? How easy is it for you to find and use their ATMs? How quickly can you set up autopay or other day-to-day transactions?
Customer assistance options. Ideally, you’re looking for a bank or credit union that makes it easy to contact a representative if you need help, and gives you contact options you’ll actually use. If you hate talking on the phone, for instance, maybe the new bank has an email or live chat feature.
Other factors will vary from person to person, like:
Your future needs. If you’re hoping your new bank will give you a mortgage loan or help you set up investment accounts down the line, find a place that offers these services.
Your banking style. Some people love online-only banking. Others want to meet with an actual person at a brick-and-mortar branch for big transactions.
Your local options. Many people prefer joining a local credit union, which is customer-owned, over signing up for a national bank. Credit unions and smaller banks have other perks, too, like better interest rates on loans for members.
Another perk of switching banks is that banks will often reward new customers. This means you may be eligible for cash rewards, temporary interest rate reductions, or other bonuses when you open a new checking or savings account.
See our current picks for the best checking account promotions and savings account promotions.
Go into the bank in person if you can, rather than opening an account over the phone (unless your bank is online). You’re more likely to get all your questions answered and you can ask directly about those potential bonus opps.
Although requirements vary depending on the bank, you’ll want to bring:
An official photo ID like a driver’s license, state ID, or passport.
Your Social Security number (you may not need your Social Security card, unless the bank specifically asks for it).
Cash, check, or payment info (routing and account number) for the opening deposit.
The minimum you’ll need to deposit will depend both on the bank and the type of account you’re setting up.
If you’re looking for a low minimum amount, or no fee required to open an account, your best bet is an online checking or savings.
Read more: Online banking vs. traditional banking
2. List and reroute any automatic transactions from your old bank
Now that you have a new bank account, it’s time to transfer your regular deposits and withdrawals. Start as soon as possible: this part may take a while if you have a lot of automatic transactions. It’s a good chance to review which services you’re spending money on (like video streaming services or memberships you forgot you had).
Here’s where your old bank statements come in handy. Get a list of your statements from the past year. Statements should be available online at your bank’s website if you don’t have paper copies.
This is a two-step process.
Step 1: Look over the past 12 months of transactions
Some automated transactions may be annual, so you might miss them in less than a year’s worth of statements. Note when deposits show up in your account and when payments are automatically withdrawn.
Keep some cash in the old account until this step is complete. You want to avoid missing scheduled payments or getting hit with overdraft fees. If you’ve written checks recently or if payments are pending, keep the old account open and funded until those payments clear.
Step 2: Switch over your deposits and payments
Once you know which deposits and payments to transfer, you can start switching them over to your new account.
If you get direct deposit from your employer, submit your new bank info (via a canceled check or just a routing and account number).
Reroute any automatic payments to your new account as soon as you can, since the change may take a few days or weeks to finalize. Some billers require notice up to a month in advance for new payment info.
Read more: How to set up direct deposit
3. Close the old account for good
Read up on your bank’s procedures for closing an account first. Some banks will let you close an account by mail, online, or over the phone; some require you to show up in person.
This list collects info on how consumers successfully closed accounts at multiple American banks. But since procedures may change, your best bet is to ask the bank directly how it’s done.
Close the account in person, if possible
I recommend closing the account in person if time and convenience allow.
A bank visit makes it easier for you to get the transaction in writing. “Zombie accounts” sometimes come back from the dead — a closed account might get reactivated if you forgot to reroute an automatic payment or if there’s a billing error. To minimize the risk of a zombie account haunting you, ask for a letter from the bank stating you closed the account.
Even if you have no funds in the account, you still need to formally close it. You may be able to close an empty account online by following the instructions on the bank’s website.
Make sure you get all the money from your account
If you have funds in the account you’re closing, the bank will usually write you a check for the amount of the balance, or just transfer funds to your new account.
Your bank may require a formal written request (such as a notarized letter) to close an account with an open balance. You may also have to go to the bank in person to pick up the check. Give the money one to two business days to transfer. A wire transfer’s faster, but it costs more.
Make sure closing the account won’t affect your credit score!
If you owe money on the account you’re closing, you won’t be able to shut it down until you pay the balance and any fees.
The bank might close an account with a negative balance after a month or so, but don’t wait for this to happen — it will negatively impact your credit. You want a neat, clean closure.
When should you switch bank accounts?
You’re merging finances with a partner
In a committed relationship where you have decided to split expenses, a joint bank account can save you money and time (many people merge accounts after marriage or entering into a domestic partnership).
You might combine finances in a brand new account, or join your partner’s existing account if their bank has more of the services you need.
Read more: How to merge bank accounts after marriage
The fees are too high
With so many banks offering fee-free checking accounts and dropping fees from high-yield savings accounts, you don’t need to stick with a bank that piles on fees.
For example, if you keep getting hit with overdraft charges despite your best intentions, look for a bank with minimal (or zero!) overdraft fees (or one without minimum balance requirements). Similarly, if you use cash frequently, pick a bank with no ATM fees.
Read more: How to stop paying ATM fees
Another bank’s features work better for your needs
It’s normal for financial situations and priorities to change, and your banking needs might change with them.
Whether you want an account that connects to a budgeting app, offers a significantly higher interest rate over time, rewards you for better credit, works with poor credit, or lets you complete all your transactions online, there are plenty of options if your current account lacks features you need.
The bank isn’t FDIC-insured
Most banks and other financial institutions have insurance from the Federal Deposit Insurance Corporation (FDIC), which protects your money up to $250,000 in case the bank fails. (They’ll mention FDIC coverage somewhere on their website, or you can see which banks are covered here). A lack of FDIC coverage is a security red flag.
You’re relocating
If you’re moving and your current bank doesn’t have physical branches near your new location, it’s often more convenient to switch — either to a big-ticket bank with branches all over the world, a local community bank in your new area, or an online-only bank.
You don’t agree with your bank’s values
Social responsibility is a big deal to a lot of consumers, and if your bank supports a cause or makes a decision you don’t agree with, you may want to put your money where your values are.
I switched from a national to a local bank for this reason with no issues (it wasn’t even awkward when I told the teller at my former bank why I was switching).
Read more: What you should know about socially responsible banks
Pros and cons of switching bank accounts
Pros
Potential cost savings. Your new bank may offer a higher interest rate for a savings account, or lower fees than your old bank. After some time, you’ll start to see the savings add up.
Possible sign-up bonuses. You can take advantage of any one-time bonuses or financial rewards your new bank offers as a “thank you” to new customers.
A better fit for your needs. Maybe you finally made the switch to an all-online bank (no branch visits!) or a local bank near where you live (fewer out-of-network ATM fees!). In any case, a bank that fits your lifestyle and preferences is the best choice.
Cons
Transferring direct deposits and autopays. This part of changing bank accounts takes some time and energy, especially if you have lots of monthly bills on autopay.
Less familiarity. You know less about the new bank’s procedures, and they know less about you — like your credit history, for instance. This means the approval process might take longer if you want a loan or additional account at your new bank.
Finding fees in the fine print. Banks and credit unions should be upfront about any fees they charge. But when you open a new account or close an old one, you’re getting a lot of information at once. Info on fees could be easy to miss if you’re not looking out for it.
The bottom line
Closing your bank account and opening a new one can be a pain, but if you take the right steps and make sure you do everything correctly, it doesn’t have to be a huge hassle.
Featured image: Lemon Tree Images/Shutterstock.com
Editor’s note: This story includes references to some credit card offers that are no longer available. You can view our current offers here.
Today I want to share a story from TPG reader Matthew Orchant, who used seven credit card bonuses and hotel free night certificates to book an epic honeymoon trip to Japan.
The Orchants opened seven credit cards in eight months, earning around half a million points to make this dream trip a reality.
Saving points on airfare to Japan
Rather than splurging on premium cabin airfare (which is also generally harder to find), the Orchants decided to book economy flights with their rewards. This gave them more points to use in Japan.
To fund their flights, the Orchants both opened The Platinum Card® from American Express with targeted welcome bonuses through CardMatch (subject to change at any time).
They booked round-trip, nonstop airfare from Washington, D.C.’s Dulles International Airport (IAD) to Tokyo’s Haneda Airport (HND) for 100,000 Aeroplan points per ticket. For reference, Air Canada Aeroplan doesn’t have the lowest award rates on this route. When X (Star Alliance economy award) fare is available, here’s the round-trip cost per person using these programs, all of which are transfer partners of American Express Membership Rewards:
Regardless, the Orchants transferred 200,000 Amex Membership Rewards points to Air Canada Aeroplan to book the ANA flight (which we’re told would have been around $5,000 for two tickets using cash), leaving them with 100,000 leftover Membership Rewards points from their two welcome bonuses. They’ll use those points for a future trip.
Related: The best ways to travel to Japan with points and miles
Luxury Hyatt stays in Japan
For their time in Tokyo, the Orchants booked the 52-floor Andaz Tokyo Toranomon Hills, which is steps away from some of the city’s top attractions, including the Imperial Palace and Tokyo Tower.
Sign up for our daily newsletter
Modern Japanese-inspired rooms and suites that sit in a prime location and come outfitted with luxurious Aesop bath amenities don’t come cheap. For their dates, rooms were going for around $1,100 per night. So, their 120,000 World of Hyatt points saved them around $4,400.
In Kyoto, the Orchants spent two nights at the Park Hyatt Kyoto. Rather than pay with cash, which would’ve cost them $4,000 for the entire stay, they redeemed 35,000 points per night for their stay.
To get their World of Hyatt accounts to 190,000 points, the Orchants both signed up for the Chase Sapphire Preferred Card. Each of their card offers included an 80,000-point sign-up bonus at the time (which has since expired). They also each opened the World of Hyatt Credit Card to earn 30,000 bonus points after spending $3,000 on purchases in their first three months from account opening.
Because you can transfer Chase Ultimate Rewards points to World of Hyatt at a 1:1 ratio, the Orchants were able to transfer most of the points they earned from signing up for their cards toward their Hyatt stays.
Related: 5 easy ways to maximize Hyatt award redemptions
Maximizing Marriott certificates
The last part of the Orchants’ trip took them to Osaka, where they made great use of free night certificates for their final three nights. Their property of choice? The brand-new W Osaka.
When they were planning their trip, the Marriott Bonvoy Boundless® Credit Card offered a sign-up bonus of three free night awards (up to 50,000 Marriott Bonvoy points per night). This offer has also expired. Since each night was just 44,000 points, they didn’t have to use points to top off their certificates.
Had the Orchants decided to pay cash, they would’ve spent just over $1,100 for the three-night stay.
Related: Ouch: It’s not just you, Marriott stays now cost more points
Bottom line
The Orchants are about to leave on an unforgettable honeymoon trip. They earned nearly half a million points by opening seven credit cards, which funded their air travel and lodging in Japan. They’ll be taking a convenient nonstop flight from Washington, D.C., while staying at some of Japan’s most prestigious hotels during the nine-night trip.
If they had paid cash for their travels, the trip would have set them back roughly $14,500.
Now, it’s worth noting that such a strategy takes time to implement thanks to the various application restrictions from the major card issuers — most notably Chase’s 5/24 rule. Nevertheless, this story shows how planning in advance can unlock incredible value when you put your rewards to use.
Congratulations to the Orchants, and safe travels to Japan.
The Southwest Rapid Rewards Plus Credit Card, like all co-branded travel cards, is aimed at people who regularly fly with Southwest Airlines.
This is a premium travel card that offers 3,000 miles every year you have it, a discount on in-flight purchases, and two free EarlyBird Check-Ins each year.
This card also features a rewards structure, providing bonus miles on spending categories like transit, commuting, internet, cable, phone, and select streaming.
Another strength of this card is its 60,000-mile signup bonus — which is more than enough to get you a round-trip ticket or two!
If you’re thinking about adding the Southwest Rapid Rewards Plus Credit Card to your wallet, this guide will help you decide.
What’s Ahead:
Is the Southwest Rapid Rewards Plus Card for me?
The Southwest Rapid Rewards Plus Card is designed for frequent flyers who like to travel with Southwest.
This means that if you’re a loyal Southwest customer or live near a Southwest hub, this card might be a great option for you. You’ll accelerate your earnings toward free flights and get some solid perks, such as two free EarlyBird Check-Ins each year.
If you aren’t a fan of Southwest or live in a place where Southwest isn’t as prevalent, this card likely won’t be as valuable as another airline or generic travel rewards credit card.
What makes this credit card different?
What makes the Southwest Rapid Rewards Plus Card different is its focus on Southwest Airlines.
Because it’s a co-branded card, it can offer unique benefits and perks that generic travel credit cards can’t. If you fly Southwest frequently, you’ll enjoy these perks.
This card also comes with a great signup bonus in the form of 60,000 bonus points plus a 30% off promo code when you spend $3,000 using the card within three months of opening your account.
You can also receive 10,000 Companion Pass qualifying points boost each year. With the Companion Pass, you can name one person, such as a spouse, partner, or friend, to be your companion. They can get a free ticket on any flight you book for yourself.
Generic travel cards don’t offer these specialized benefits and bonuses, so they likely won’t be as appealing to people who prefer to fly with Southwest.
Related: Best credit card sign up bonuses
What are my chances of getting approved?
As with any credit card, it’s important to think about whether you have a chance of qualifying before you apply. Applying for a new credit card drops your credit score by a few points, so you don’t want to lower your credit for no reason.
Chase, this Southwest credit card’s issuer, says that applicants require good credit to be eligible for the card. That means you should try to have a credit score of about 670 or higher before you apply.
All the details of the Southwest Rapid Rewards Plus Card
Credit cards are complicated, so before you sign up for one, you must make sure you understand how they work.
Rates and fees
The first thing to look at when you want to get a new credit card is how much the card will cost. Some cards, including travel cards, have annual fees, so you want to make sure the benefits and perks you’ll get cover the cost of having the card.
The Southwest Rapid Rewards Plus Card charges $69 per year.
Perks and rewards
When it comes to travel cards, it’s all about the perks and rewards. A good travel card should let you earn your way toward free trips and help you travel more comfortably.
The Southwest Rapid Rewards Plus Card does it all, with a great signup bonus, strong ongoing rewards, and some nice perks to use whenever you’re on a flight.
To start things off, you can earn 60,000 points plus a 30% off promo code when you spend $3,000 within your first three months of having the card.
After that, you’ll earn:
2 points for each dollar spent on Southwest purchases.
2 points for each dollar spent on Rapid Rewards® hotel and car rental partners.
2 points for each dollar spent on local transit and commuting, including rideshare.
2 points for each dollar spent on internet, cable, phone services, and select streaming services.
1 point for each dollar spent on all other purchases.
As for perks, cardholders will get a 3,000-point bonus on each card member anniversary. You can also use the card to get two free EarlyBird Check-Ins each year and 25% back on all inflight purchases.
You’ll also get all the typical credit card perks and benefits, including extended warranty protection and purchase protection.
Related: Best travel rewards cards
How to apply
The easiest way to apply for the Southwest Rapid Rewards Plus card is to visit Chase’s website. Chase is the bank that Southwest partners with to offer this credit card.
To start the process, you’ll enter your personal info, including your:
Name.
Date of birth.
Mother’s maiden name.
Social Security number.
Address.
You’ll also need to provide your Southwest Rapid Rewards number if you have one. If you don’t, Chase will automatically set one up for you if you’re approved.
Finally, you’ll enter whether you rent or own, your monthly rent payment amount (if applicable), and your total annual income. Once you apply, Chase will review it and make a lending decision.
Typically, Chase can make a decision instantly. However, if the bank has trouble matching your information to your credit file or wants to take a closer look at some of the application details, you may have to wait for a decision in the mail.
Contact info
If you have issues with your Southwest Rapid Rewards Plus card, the best thing to do is reach out to Chase’s customer service.
You can contact Chase by signing in to your account and sending a secure message. You can also call credit card customer service at 1-800-432-3117 or contact @ChaseSupport on social media.
Other stuff you should know
One important thing to note about the Southwest Rapid Rewards Plus card is that it’s not the only Southwest travel card available. There are two others: the Priority card and the Premier card.
The Plus is the entry-level card. It has the lowest annual fee but the fewest perks of the three Southwest cards.
The Premier card is the next level up from the Plus card. It has a higher annual fee at $99 but offers 3x points on all Southwest purchases, 6,000 points on every cardmember anniversary, and bonus qualifying points toward A-List status.
The Priority card is the top-end Southwest card. It has a $149 annual fee but offers 7,500 points on every card member anniversary and a $75 credit for Southwest travel each year. You’ll also receive four upgraded boardings each year.
Another thing to consider is that the Southwest Rapid Rewards Plus card is designed for Southwest flyers. The rewards you earn are pretty inflexible and typically only good for Southwest flights. There are some gift card redemption options, but they aren’t a good value.
Alternative credit cards to the Southwest Rapid Rewards Plus Card Credit Card
If the Southwest Rapid Rewards Plus Card doesn’t seem like the right one for you, consider the following alternatives:
Southwest Priority: This card is useful for people who spend a lot on it and want to earn A-List status.
Southwest Premier: For frequent travelers, this card’s annual statement credit and points mostly cover the fee. You’ll also enjoy the upgraded boarding perk.
Chase Sapphire Preferred® Card: This is another Chase card with far more flexible rewards, letting you redeem points for any travel.
Capital One Venture Rewards Credit Card: This card has a $95 annual fee and offers strong cash back rates on travel purchases.
American Express Gold: This is the mid-tier Membership Rewards card. It offers flexible rewards and a good earnings rate on food and travel.
How do you determine which credit card is right for you?
When you’re in the market for a new credit card, you should compare your options to find the right one. When making this comparison, consider the following factors:
Your ability to qualify. Card issuers design different cards for people with different credit profiles. Before you apply, make sure you have a good chance of qualifying for the card.
Fees. Some cards, especially travel cards, carry annual fees. Make sure you’re getting enough value from the card to make the fee worth paying.
Perks. Each card has a different set of perks and benefits. Make sure the perks you receive from the card are useful for you.
Rewards. Credit cards can offer cash back, points, miles, or other rewards. Make sure the rewards on offer align with your goals. It’s also important to think about their flexibility. You don’t want to be stuck with miles you can’t use. Also, consider the rate of earning those rewards, and look for cards that offer bonuses on the types of purchases you make most often.
Rates. In general, you should avoid carrying a credit card balance whenever possible. However, sometimes you have to carry a balance. When that happens, having a card with a low interest rate is good.
Southwest Rapid Rewards Plus Card FAQ
Can I pool my Southwest miles with someone else’s?
No, Southwest does not offer any way to pool your rewards with another person.
What is the Southwest Companion Pass?
The Southwest Companion Pass is a perk you can earn through a credit card signup bonus or by taking a lot of flights in a single year. When you earn this pass, you can choose one other person to get a free ticket on every flight you book until the end of the calendar year after you earned it.
So, if you earn the pass in 2023, it will expire at the end of 2024. Some passes earned through promotions have different expiration dates.
Can I redeem my Southwest points for things other than flights?
Yes, you can redeem your Southwest points for gift cards to many popular retailers. However, redeeming points for flights is typically a better value.
Why choose the Southwest Rapid Rewards Plus Card?
With a strong signup bonus and some nice perks, the Southwest Rapid Rewards Plus Card is a good option for frequent Southwest fliers.
Given its reasonable price, substantial signup bonus, and valuable perks, we give the Southwest Rapid Rewards Plus Credit Card a 4 out of 5 rating.
If you think this is the right card for you, apply now.
When you choose a bank for your daily checking and savings needs, you can choose between a national bank, a smaller regional bank, credit unions of varying sizes, and even online banks and financial technology companies.
Since early 2023, when Signature Bank and Silicon Valley Bank both experienced failures after customers pulled out large amounts of money during bank runs, banking customers may feel more comfortable choosing a national bank.
Although the U.S. government took extraordinary measures to protect the assets of SVB and Signature Bank customers, and deposits held in the accounts were FDIC insured, many customers were still rightfully concerned about gaining access to their money in a timely manner.
After the banking crisis of 2008, the Federal government declared banks like JPMorgan Chase, Bank of America, Citibank, and Wells Fargo as “too big to fail.” But these aren’t the only national banks or credit unions available.
You might think that smaller online banks may have lower fees, while small local banks are known for friendly and responsive customer service. But the national banks on this list blend the best of all worlds: low fees, high marks for customer satisfaction, ways to avoid overdraft fees, convenient ATM networks, and a variety of banking products.
16 Best National Banks
Here are the 16 best national banks that offer exceptional services, excellent customer support, and innovative banking solutions to meet all of your financial needs.
1. SoFi – Best for Digital Banking & High Yields
SoFi became a nationally chartered online bank in 2022, after acquiring Golden Pacific Bancorp, Member FDIC. Originally known for its vast array of loan products, including private student loans, today SoFi has a combination checking and savings account, or a cash management account, with no monthly service fee.
SoFi also has no minimum balance requirements, no overdraft fee, and overdraft protection up to $50 with qualifying direct deposits each month. You can bank for free at any of 55,000+ fee free Allpoint ATMs nationwide.
As an online bank, SoFi offers higher interest rates than you may find at brick and mortar banks. Earn up to 4.20% APY on your savings account balance and 1.20% on money in your checking account. When you use your SoFi debit card at select local businesses, you can earn up to 15% cash back.
SoFi offers two tiers of accounts: SoFi and SoFi Plus. To qualify for the “freemium” SoFi Plus membership, bank customers must have qualifying direct deposits. Plus, when you sign up before December 31, 2023, you can earn a cash bonus of $250 when you set up direct deposits of $5,000 or $50 with a direct deposit as low as $1,000.
SoFi Plus members receive loan rate discounts, bonus rewards, access to special entertainment events and more, making SoFi a unique company when it comes to online banks.
2. Discover Bank – Best for Cash Back
Discover may be best known for cashback and rewards credit cards. But its online banking products are some of the best you’ll find among national banks.
With no monthly fees and no minimum balance, your Discover Cashback checking account pays 1% cashback on up to $3,000 worth of debit card purchases monthly. You’ll never pay overdraft charges, and you can withdraw cash at a network of 60,000+ fee free ATMs.
You can qualify for overdraft protection by linking your Discover Bank savings account. Discover Savings pays a high 3.90% APY with no minimum deposit required.
Other Discover Bank deposit accounts include CDs with terms from 3 months to 10 years, and a money market account that pays 3.80% APY for balances under $100,000 and 3.85% on balances $100,000 and up.
For questions or help with your account, you can reach a U.S.-based customer service representative for Discover Bank by phone, 24/7/365.
3. Chase Bank – Best for Credit Card Rewards & Referral Bonuses
As the world’s largest national bank, JPMorgan Chase Bank doesn’t need to do much to entice customers. People will choose Chase based on its name, reputation, and more than 4,700 convenient branch locations across the U.S.
However, Chase happens to have one of the best bonuses for new customers and a generous referral bonus program when existing customers refer their friends. This, coupled with a robust and easy-to-use mobile app and a variety of checking, savings and investment services, puts Chase on our list of top national banks in the U.S.
Chase is currently offering new Chase Total Checking customers a $200 bonus when they open a new account and set up direct deposit within the first 90 days.
New or upgrading Chase Private Client customers can earn a $3,000 bonus with a deposit of $500,000 or more within the first 45 days of account opening. Deposits of $150,000 to $249,999 earn $1,000 and cash deposits of $250,000 to $499,999 earn $2,000. You must keep the money in your J.P. Morgan Wealth Management or JPMorgan Chase deposit accounts for 90 days to qualify.
In addition to Chase Total Checking, the bank’s most popular checking account, and Private Client services, Chase also offers other checking and savings accounts.
Chase Secure Banking has a $4.95 monthly fee and no overdraft fees. Chase Premier Plus Checking offers a few added benefits beyond Chase Total Checking, including ATM fee rebates up to four times per statement cycle, a linked personal checking account with no monthly fees, and a 0.01% interest rate on balances.
Chase also offers bank accounts for kids, teens, and college students, as well as CDs, savings and money market accounts, mortgages, loan products, and a full array of top-rated rewards credit cards.
If you have multiple Chase accounts, it’s easy to manage them all within the mobile app.
4. Chime – Best for Building Credit
Chime is a financial technology company backed by Stride Bank, Member FDIC, and Bancorp Bank, Member FDIC. It is not a bank, itself, but offers some of the same features, including online banking, a debit card, and direct deposit up to two days earlier than some other banks.
Chime has no monthly service fee, no overdraft fee, and no minimum balance requirements. For customers who need a little boost to make it from paycheck to paycheck, Chime offers fee-free overdraft up to $200 through the SpotMe5 program and a credit builder secured Visa credit card with no annual fees, interest or minimum security deposit.
Use your Chime debit card at any of 60,000+ fee free1 ATMs in the Allpoint, MoneyPass or Visa Plus Alliance ATM networks. Out of network ATM fees may apply, otherwise.
You can qualify for Chime’s SpotMe program with a single direct deposit of $200 or more during any monthly statement period. If you process a transaction that would put you into overdraft, Chime will accept the transaction even if it puts your balance into the negative by up to $200.
The Credit Builder Secured Visa card carries the same requirements of a $200 monthly minimum direct deposit. You can build your credit and raise your credit score with responsible use of the card.
5. Citi® – Best for Large Cash Deposits
The third of the four largest national banks in the U.S. based on assets, Citi, owned by Citigroup, is best for high net worth customers or those with large cash deposits divided among Citi checking, savings, and other accounts.
Currently, you can earn a generous cash bonus of $200 to $2,000 when you open a qualifying Citi checking account and meet specific minimum opening deposit requirements. Your bonus will be determined by your account balance on the 20th day after opening the account. Funds must remain in the account for an additional 60 days after the 21st day.
Citi offers multiple checking accounts to meet various customers’ financial needs, all with monthly fees that are easy to waive if you hold the required minimum balance. The bank accounts include:
Citibank
Citi Priority, which includes travel perks and access Citi Personal Wealth Management advisors
Citigold, relationship banking and investment services
Basic Banking and ATM access
Access Account, a debit account with no paper checks
For the Basic Checking account, you’ll need to maintain a $1,500 minimum balance to waive the fees. The other accounts have larger minimum balance requirements to avoid monthly maintenance fees and take advantage of other perks, up to $200,000 for a Citigold account.
All accounts provide access to personal banking at Citi branches and access to more than 65,000 fee free ATMs across the U.S. All accounts except for Basic and Access accounts also have no fees at ATMs outside the Citi network.
Like all the larger national banks on this list, Citi has a full gamut of rewards credit cards, savings and money market accounts, and high-yield CDs.
6. CIT Bank – Best for High Interest Rates
CIT Bank, a division of First Citizens Bank, has earned awards and accolades for customer satisfaction, rated by American Banker as #1 for “delivering the most humanized experience in banking.”
You should be aware that deposits in First Citizens Bank & Trust Company, Member FDIC, are not separately insured. This only matters if you hold more than $250,000 in any single account type, such as checking or savings, in both First Citizens Bank and in CIT Bank.
CIT is the online only banking arm of First Citizens Bank, with high-yield savings accounts, CDs, money markets, and eChecking, all with no monthly fees and no overdraft fees. You won’t pay any ATM fees at CIT Bank machines, and CIT Bank reimburses up to $30 per month when you use out-of-network ATMs.
CIT offers 0.25% APY on checking when you hold more than $25,000 in your account, and 0.10% APY on balances under $25,000. The bank has high interest rates for savings, offering customers a 4.85% APY on balances of $5,000 or more with the Platinum Savings account.
CIT Bank has two other savings accounts as well:
Savings Connect, with a 4.60% APY
Savings Builder, which requires a minimum balance of $25,000 or a $100 monthly deposit to earn 1.00% APY
You’ll need a $100 minimum deposit to open a checking or savings account at CIT Bank.
7. Bank of America – Best for College Students
As the second largest of the best national banks, behind Chase, Bank of America has the full gamut of banking products, with three checking accounts plus a student account, savings, CDs, and investment products.
It’s easy to waive monthly maintenance fees on a checking account with a minimum daily balance, direct deposits, combined balances across eligible linked Bank of America accounts, or by enrolling in their Preferred Rewards programs.
We like the Advantage SafeBalance banking for kids, teens, and college students under 25 years old. They have no monthly fee and no overdraft fees. Teens ages 16+ can have sole ownership of the account.
For everyone else, the bank offers Advantage Plus and Advantage Relationship checking accounts with easy ways to waive the monthly fees with direct deposit or a minimum daily balance.
When you open a new checking account, you can qualify for a $100 bonus when you receive qualifying direct deposits of at least $1,000 within 90 days of opening the account.
Of course, Bank of America also has CDs, and a savings and money market account. Plus you can invest with Merrill. All of these deposit accounts count toward your Preferred Rewards membership.
When you have a combined average daily balance of at least $20,000 for three months, you’ll qualify for the rewards program.
8. U.S. Bank – Best for Military Members & High Balance Savings
U.S. Bank offers the Bank Smartly checking account so you can earn interest on your money. The current interest rate is just 0.01% APY on all checking balances. You’ll pay a $6.95 maintenance fee, but this is waived if you meet minimum deposit requirements or if you are a member of the U.S. military.
You can link your Bank Smartly checking account to a standard savings account or Elite Money Market to earn even more. To avoid fees on your savings account, you’ll want to keep a $300 minimum daily balance or a $1,000 average monthly collected balance. If you are already a Bank Smartly customer, you can enroll in Smart Rewards to waive savings account fees.
The Elite account is better for those with high balances. You can earn up to 4% APY on balances from $25,000 up to just under $500,000.
The appeal of U.S. Bank is in its high ratings for banking satisfaction across the board from customers. U.S. Bank earned accolades for having the best mobile app, the best digital mortgage tools, the best customer service features, and best mobile check deposit capabilities. These factors all contribute to its ranking as a best national bank.
9. Axos Bank – Best Online Bank
Axos is an online only bank with a rewards checking account that delivers up to 3.30% APY, with no fees and unlimited ATM fee rebates for out-of-network ATMs.
To earn the maximum APY, you’ll need to set up direct deposit and Axos Bank’s free Personal Finance Manager for 0.70% interest. Then, open an investment account and take out an Axos personal loan or auto loan and earn another 2.60% annual percentage yield on your checking account balance.
Axos also offers an Essential Checking account with early direct deposit and no fees, and a Cashback Checking account, which gives you 1% cash back on debit card purchases, along with no maintenance fees and unlimited domestic ATM fee reimbursements.
Voted the best online bank by many top personal finance sites, Axos Bank offers more than just high interest, no fee checking.
Axos Bank offers CDs with terms between 3 and 60 months and a savings account with 0.61% annual percentage yield, with interest compounded daily. You can also find personal loans, car loans, mortgages, and investment products.
Like other national banks, Axos Bank provides FDIC insurance up to $250,000 or $500,000 for joint account holders. But you can expand your coverage up to $150 million with Axos Bank InsureGuard+ Savings from IntraFi Network Deposits.
Axos splits up your large deposit into multiple accounts across several banks, each covered up to $250,000. If you are dealing with a substantial amount of cash and want your savings protected at a single bank, Axos may be a good choice for you.
New customers can earn a $100 welcome bonus by opening an account with just a $50 minimum opening deposit.
10. Truist Bank – Best for Relationship Banking & Innovative Savings Perks
Truist Bank is one of the top 10 largest national banks, formed as a merger between BB&T and SunTrust in 2019. Called “the biggest bank you’ve never heard of” by CNN Business, Truist holds assets of $574 billion and has been growing steadily since the merger.
Truist offers checking and savings accounts, CDs, and credit cards. Truist checking and savings customers can earn perks and benefits. This includes access to Long Game, a savings game app that lets you earn cash when depositing into your Truist savings account. It also includes bonus rewards on your Truist credit cards.
Truist has four levels of relationship banking in its Truist One checking account. This means the more you deposit, the more perks you will receive, up to a 50% loyalty bonus on Truist credit cards, and a discounted annual fee for a Delta SkyMiles debit card. Benefits for relationship banking begin at $10,000 in combined average monthly balances for Truist deposit accounts.
Your Truist checking account has a $12 monthly fee, which is easy to waive with $500 or more in direct deposits each month or a $500 minimum balance across all Truist deposit accounts. Truist personal loan, mortgage or credit card customers also pay no fees on their Truist checking account.
You can also waive the monthly fee with a linked Small Business checking account or if you are a student under the age of 25. You’ll need a $25 minimum opening deposit for a Truist One checking.
Customers with lower income or just getting started establishing their finances can benefit from Truist Confidence checking and savings accounts. The account has just a $5 monthly maintenance fee, which is easily waived.
11. Capital One – Best for High Interest Rates at a Brick and Mortar Bank
Like Chase Bank, Capital One is well known for its top-rated rewards credit cards. The company is also one of the best national banks with a savings account and CDs offering interest rates higher than the national average.
Capital One Performance 360 savings has a 3.90% APY, no monthly maintenance fees, and no minimum deposit to open your account. A Capital One 360 Performance checking account, similarly, has no monthly maintenance fee, overdraft protection through your linked savings account, and early direct deposit.
You can bank with no fees at a network of 70,000+ ATMs nationwide, and can deposit cash easily at CVS retail locations. Although you must open your Capital One Performance account online, you can receive personalized service and deposit cash at any Capital One bank branches or Capital One Cafes.
12. PNC Bank – Best in East and Southwest
PNC Bank is a large, national bank with branch locations across 29 states. Most branches are in the east, south, and southwest, although you will also find branch locations in some Midwest states.
PNC Bank’s online checking account is called Spend and it links to the PNC VirtualWallet. You can add a savings account, called Reserve, or upgrade to the Performance Select product with two tiers of savings and double layer overdraft protection.
When you set up your VirtualWallet with PNC Bank and open your Spend account, you can earn a $50 bonus.
Combining your Spend account with a PNC Bank Reserve account yields even more benefits. Earn a $200 bonus when you qualify. Finally, if you open a Performance Select VirtualWallet, you could earn $400.
Each account comes with a low monthly fee that is easily waived through qualifying monthly direct deposits or by meeting minimum balance requirements.
13. Wells Fargo – Best for Checking Account Options
Wells Fargo, one of the “big four,” is the fourth largest of the best national banks in the U.S. It is known for having many convenient bank locations, with 4,700 branch locations.
The vast number of branches across the country puts it top on our list for in-person banking and customer satisfaction.
Plus, we also rated it best for various checking account choices for everyone from children to retail investors.
Like the other national banks on this list, Wells Fargo has checking, savings, and CD accounts. The bank has four checking account options for consumers at various stages of their financial lives:
Clear Access Banking, with no overdraft fee and a low $5 monthly fee, waived for teens and young adults ages 13 to 24
Everyday Checking, the most popular bank account, with optional overdraft protection
Prime Checking, offering discounted interest rates for loans and higher interest rates for linked CDs and savings accounts
Premier Checking, a relationship banking service with 24/7 support and discounts on investing services
It’s easy to waive the $10 fee on Everyday Checking with a $500 minimum daily balance or $500 in monthly direct deposits. Waive the $25 fee on your Prime checking with $20,000 in linked balances. Similarly, your Premier Checking account will be free with $250,000 in linked balances, including investments with the bank’s Advisors.
You’ll need a $25 minimum opening deposit to open your account.
14. Ally Bank – Best Online Only Bank for Savings
Ally Bank is widely recognized as one of the best national online banks. It has very few fees, including no maintenance fee, no overdraft fee, and no ACH fee (even on expedited transfers). Plus, you’ll earn interest of 0.25% in your checking account and 3.85% APY on savings, including money you have allocated into various buckets.
We rated Ally Bank as the best online only bank for savings, not just because of the high interest rate, but because it offers so many ways to manage your money and ramp up your savings efforts.
You can set up recurring transfers into your savings account for specific goals or just to build up your emergency coffers. You can choose to round up transactions made with your Ally Bank debit card, or even electronic payments and checks. When Ally Bank finds at least $5 in “round-up” savings, it will be transferred automatically to your checking account.
Finally, Ally Bank analyzes your checking account periodically to reveal extra funds that are “safe to save.” Ally Bank automatically transfers that money for you. But you can transfer it back whenever you’d like.
In addition to these savings benefits, Ally Bank lets you access your money with your debit card with no fees at any of 43,000+ Allpoint ATMs. The online bank also refunds up to $10 in fees charged by out-of-network ATMs.
You can avoid stress and overspending with the Overdraft Transfer Service, which automatically transfers money from your Ally Bank savings account into checking. If you exceed six transfers or six savings withdrawals per month, Ally Bank will reimburse those fees, too.
You can also apply for CoverDraft℠ Coverage, which will cover up to $250 in charges that would put your account in the negative. You’ll qualify 30 days after you deposit at least $100 into your checking account. If you receive qualifying direct deposits of at least $250 two months in a row, you can increase your coverage to $250.
15. TD Bank – Best for Overall Banking Satisfaction
TD Bank, deemed America’s most convenient bank for its number of branches, branch hours and excellent customer service, blends the best of brick and mortar banks with easy online banking.
Most TD Bank locations are open seven days a week, including Sundays, with extended hours beyond what most brick and mortar banks provide. Most TD Bank branches are located across the East Coast, with locations in 15 different states and Washington, D.C.
TD Bank is the 7th largest bank in the U.S. based on deposits, with 1,668 branch locations nationwide. You can also reach customer service by phone, 24/7/365, which earns TD Bank high marks for banking satisfaction.
TD Bank offers six checking accounts for customers in various life stages:
TD Essential Banking
TD Convenience Checking
TD Beyond Checking
TD Simple Checking
TD 60 Plus Checking
TD Student Checking (for ages 17 to 23)
Currently, TD Bank is offering sign-on bonuses for new customers who open a TD Beyond or TD Convenience bank account. You’ll need a qualifying direct deposit (or more than one) totaling $2,500 within the first 60 days to earn $300 with TD Beyond, and a direct deposit of just $500 within the first 60 days to earn $200 with TD Convenience.
16. Schwab Bank – Best for Investors
Schwab may be best known as an investment service, but the bank was rated highest in banking satisfaction with checking accounts from J.D. Power & Associates four years running.
If you have a Schwab investment account, or are considering opening one, Schwab could be the best choice in banking for you.
The Schwab Bank Investor checking account has no foreign transaction fees, no minimums, and unlimited ATM fee rebates. Plus, earn 0.45% annual percentage yield on checking. Schwab’s savings account offers 0.48% APY.
Schwab also offers exceptionally high interest rates for CDs, with up to 5.40% APY and terms as short as 30 days. You’ll receive FDIC protection exceeding the federal maximum because you can purchase CDs from multiple banks, all through Schwab investment.
Methodology: How We Chose the Best National Banks
We evaluated a variety of banks and credit cards, taking into consideration the:
Variety of products
Interest rates
Monthly fees
ATM fees and ATM fee reimbursement
Branch locations and number of branches
Minimum deposit requirements
Fraud protection and security
We also looked at consumer reviews, and drew on the general reputation of each bank to find the best national bank.
Finding the Best National Bank
Now that we’ve explored the specifics of the best online banks and brick and mortar banks nationwide, you probably still have questions about which one is really the best national bank.
Let’s compare the three largest in the U.S. based on number of branches, interest rates, and overall banking satisfaction.
Chase vs. Wells Fargo
For the largest nationwide bank, Chase offers excellent banking satisfaction with an A+ rating from the Better Business Bureau, 4,800 branch locations, and an easy and intuitive mobile app. If you are shopping for a bank credit card, Chase also offers some of the best rewards cards available today.
Wells Fargo rivals Chase when it comes to number of branches, with roughly 4,700 locations across the U.S. It’s somewhat easier to waive the checking account fees at Wells Fargo. Wells Fargo offers higher interest rates for savings, with a 0.15% APY compared to Chase’s 0.01%.
Both banks have lower interest rates than you might find at online banks. However, if you are looking for national banks with a solid reputation, many branches, and high marks in banking satisfaction, either Chase or Wells Fargo would be a good choice.
Wells Fargo vs. Bank of America
Bank of America and Wells Fargo are the second and third-largest banks in the U.S. based on assets. BofA only has 4,000 branches compared to Fargo’s 4,700, but BofA boasts more ATMs nationwide.
BofA stands out when you join the Preferred Rewards program because you can waive the fees on your bank account and enjoy perks, bonus rewards on BofA credit cards, and rate discounts on loans.
If you have a large balance or are looking for an investing platform through your bank, BofA may be your best choice. On the other hand, Wells Fargo offers high interest rates on savings and convenient branch locations nationwide.
Common Questions
People have many questions related to whether an online bank is better than a traditional bank or whether a local bank is better than one of the largest national banks. We break it all down here.
Which is better, an online bank or a brick-and-mortar bank?
If you are looking for the highest interest rates and generous rewards programs, you are highly likely to find them at online banks. However, there are some advantages to a brick and mortar bank, including in-person service at local branches, the availability of paper checks, and easy ways to deposit cash in person or at branch ATMs.
You should expect the best national online banks and the best brick and mortar banks to have robust mobile apps, easy-to-waive fees, and fraud protection.
Make sure whatever bank you choose is “Member FDIC,” which means your deposits are insured up to $250,000 per account holder, per account type. That means joint accounts have $500,000 worth of FDIC insurance protection.
Is my money safer in a national bank vs. a regional bank (or a national credit union vs. a regional credit union)?
All banks on this list are Member FDIC, which means they are insured to the maximum allowable limit of $250,000 per account holder, per account type. Credit unions are covered up to the same limits by the National Credit Union Administration.
Many online banks are insured up to $2 million or more. These financial institutions divide cash deposits among multiple partner banks. Each bank insures deposits up to the maximum limit allowed by the Federal Deposit Insurance Corp. Read the fine print to determine your coverage limits when you choose a bank.
Beyond that, your money should be equally safe in a national bank, a smaller bank, or a credit union of any size. Also look for features such as fraud protection, fraud alerts via text, email or in the mobile app, and enhanced website security measures. You should also be able to lock and unlock your debit card in the mobile app if you misplace it or believe it may have been stolen.
What makes big banks different from smaller banks?
By definition, big banks will have larger market capitalization, which represents the total value of a bank’s stocks. Big banks will also hold more assets. For instance, Chase, which is the world’s largest financial institution, holds $3.2 trillion in assets. The second-largest national bank, Bank of America, possesses $2.41 trillion in assets. Larger financial institutions may also have more bank branches.
In many other ways, big national banks and smaller banks are similar, especially today. Customers want specific features and are unwilling to compromise on things like fee-free ATMs, no monthly fees, early direct deposit, and an intuitive mobile app.
How much interest do the best big banks pay?
In general, some of the largest national banks do not have the highest interest rates for savings and very few offer interest earning checking accounts.
Capital One 360 and Discover are two of the best national banks that offer interest on checking. To earn a higher APY with one of the largest national banks, you might want to consider CDs.
Are national banks better than other kinds of banks?
National banks aren’t necessarily better or worse than other kinds of banks. They may have more convenient branch locations, a higher number of branches, and a greater variety of products, but they might also have higher fees. Decide what’s most important to you when you choose a bank.
If you’d prefer to trust your money with one of the largest national banks, with a large market capitalization, high value, and branches nationwide, consider opening your checking and savings accounts with one of the best national banks on this list.
Chime is a financial technology company, not a bank. Banking services and debit card provided by The Bancorp Bank N.A. or Stride Bank, N.A.; Members FDIC. Credit Builder card issued by Stride Bank, N.A.
The Chime Credit Builder Visa® Card is issued by Stride Bank, N.A., Member FDIC, pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa credit cards are accepted.
1. Out-of-network ATM withdrawal fees may apply with Chime except at MoneyPass ATMs in a 7-Eleven, or any Allpoint or Visa Plus Alliance ATM.
5. Chime SpotMe is an optional, no fee service that requires a single deposit of $200 or more in qualifying direct deposits to the Chime Checking Account each at least once every 34 days. All qualifying members will be allowed to overdraw their account up to $20 on debit card purchases and cash withdrawals initially, but may be later eligible for a higher limit of up to $200 or more based on member’s Chime Account history, direct deposit frequency and amount, spending activity and other risk-based factors. Your limit will be displayed to you within the Chime mobile app. You will receive notice of any changes to your limit. Your limit may change at any time, at Chime’s discretion. Although there are no overdraft fees, there may be out-of-network or third party fees associated with ATM transactions. SpotMe won’t cover non-debit card transactions, including ACH transfers, Pay Anyone transfers, or Chime Checkbook transactions. See Terms and Conditions.
If you have a savings account, how much interest does it earn? Probably not enough. And if you don’t have a savings account, why not?
A savings account isn’t meant to make you rich. It’s a safe, if not very sexy, way to plan for your future and protect your money. But things get more interesting when you choose a high-yield savings account instead of a traditional savings account. A traditional account will pay pennies on your balance, but a high-yield savings account can help you earn extra money you’ll actually notice.
But how do you choose a savings account when there are so many out there? We did the research for you. These are the top high-yield savings accounts with the best interest rates, features, and benefits.
What’s Ahead:
Best high-yield savings accounts
The Ally Online Savings Account is our top pick for the best high-yield savings account overall because it consistently offers a competitive interest rate and includes features to help you save. For beginners, the Discover Online Savings Account might be a better option thanks to its simple platform and above-average support. The CIT Savings Account is our second runner-up because it has the highest APY of the bunch but does come with a minimum deposit requirement.
We also considered the Axos Bank High-Yield Savings Account, High-Yield Chime® Savings Account, Capital One 360 Performance Savings Account, and Marcus Online Savings Account for our list. Even though these didn’t make our top three, they’re all good choices well worth checking out.
Best overall: Ally Online Savings Account
Pros
No fees
No minimums
Boosters to help you save faster
Cons
No branch locations
Features
Minimum balance: $0
Minimum deposit: $0
APY: 2.50%
Monthly fee: $0
The Ally Online Savings Account is the best high-yield savings account overall offering a generous interest rate and tons of free features to help you save. And speaking of free, this account really is. There are no monthly maintenance fees, overdraft fees, or transfer fees to deplete your earnings.
This high-yield savings account supports you to save by giving you the option to create buckets for different goals and use boosters to save faster. The boosters are:
Recurring Transfers – schedules automatic transfers from a linked account
Round Ups – rounds up your Ally debit card purchases to the nearest dollar and sends the extra to your savings
Surprise Savings – points out money in your checking account that isn’t being used for anything and moves it to your savings
This account is easy to open. There are no minimum balance requirements to earn interest and you can fund it with as little as $0.01. While Ally technically uses balance tiers (<$5,000, $5000 – $24,999.99, and >$25,000), all positive balances currently earn the same rate.
For help with any issues you might have, Ally offers 24/7 live customer support via chat or phone.
Learn more about the Ally Online Savings Account or read our full review.
Best for beginners: Discover Online Savings Account
Pros
No fees
No minimums
Instant transfers between Discover accounts
Cons
Very few branch locations
No advanced savings features like buckets or round-ups
Features
Minimum balance: $0
Minimum deposit: $0
APY: 4.00%
Monthly fee: $0
The Discover Online Savings Account gets pretty much everything right, from the competitive interest rate to the lack of account fees. We love this high-yield savings account for beginners because it’s easy to use and doesn’t have minimums.
There is no minimum deposit to open or minimum balance required to earn interest or avoid having your account shut down, making this the perfect option for you even if you only have a few bucks to put away right now. You can even open an account with nothing and come back later to fund it.
Although this is a pretty basic account with few bells and whistles, there’s no monthly maintenance fee to worry about and you’ll earn interest on any balance. Plus, the Discover mobile app is notoriously solid, and ditto for customer service.
Interest is compounded daily and credited monthly into your account. If you have a Discover checking account and debit card, you can easily transfer money between this and your savings account. You can also schedule automatic recurring transfers to put your saving on autopilot.
Discover does have some branch locations, but they’re really limited, so you might not have the option to manage your account in person. This account also lacks features to help organize and simplify your saving such as buckets and round-ups.
Learn more about the Discover Online Savings Account or read our full review.
Best for long-term saving: CIT Savings Connect Account
Pros
No fees
No minimum balance
Cons
Minimum deposit required
No branch locations
Features
Minimum balance: $0
Minimum deposit: $100
APY: 4.50%
Monthly fee: $0
For high-interest saving, the CIT Savings Connect Account is an excellent choice. This is a newer account with a really competitive APY of 4.50%. There are no minimum balance requirements to earn this rate and you only need to deposit $100 to open. Plus, there are no monthly fees. See details here.
CIT Bank also reimburses up to $30 in third-party ATM fees per statement period and supports free mobile check deposits and external transfers.
The CIT Savings Connect account currently pays the same interest rate on all balance tiers, so you don’t have to worry about maintaining a certain balance or making regular deposits to avoid fees and earn more (although automating your saving is never a bad idea).
This basic account would be a good fit for most people, especially those looking for a fee-free option with no balance requirements. It has one of the best rates and is one of the most straightforward to open and use, so it could make a great primary or secondary savings bucket. Choose the CIT Savings Connect account if getting the best interest rate is your top priority.
CIT Bank offers a number of other savings products including stand-out money market accounts and CDs, so keep this bank in mind if you have a few different savings goals and want to make sure you’re getting the highest rates.
Learn more about the CIT Savings Connect account.
CIT Bank. Member FDIC.
CIT Savings Builder Account
And if you’re looking for another option from this online bank, you can do worse than the CIT Savings Builder Account. This high-yield savings account offers an interest rate of up to 1.00% with a low minimum initial deposit requirement of $100. There is no minimum balance required to keep your account, but your balance will determine your interest rate. See details here.
The CIT Savings Builder Account uses a tiered rate structure with a loophole. The balance tiers and interest rates are:
<$25,000 – 0.40% APY
<$25,000 – 1.00% APY if you make a monthly deposit of $100 or more
>$25,000 – 1.00% APY
If you can’t afford to put away more than $25,000, no worries. Just schedule an automatic transfer of at least $100 from a linked bank account to get yourself into the higher tier. This can also help you make saving a priority.
Because of the tiered interest rate structure, this high-yield savings account is ideal for people who plan to keep high balances and/or make regular contributions to their savings.
Learn more about the CIT Savings Builder Account or read our full review.
CIT Bank. Member FDIC.
Great alternatives
These accounts didn’t make our top three, but they still have a lot to offer, especially if you’re looking for an online savings account.
Axos Bank High-Yield Savings Account
Features
Minimum balance: $0
Minimum deposit: $250
APY: Up to 0.61%
Monthly fees: None
An Axos Bank High-Yield Savings Account is the right high-yield savings account for anyone looking to keep a low balance. There is a minimum deposit requirement of $250 to open an account, but any amount you save will earn interest. Axos uses a tiered rate structure but actually pays the highest rates on the lowest balances. You’ll earn 0.61% as long as your account stays below $24,999.99.
Each account comes with a free ATM card upon request for easy withdrawals. Plus, you can earn a referral bonus of $20 for every friend who opens an Essential Checking account using your unique link.
Open an Axos savings account or read our full review.
High-Yield Chime® Savings Account
Features
Minimum balance: $0
Minimum deposit: $0
APY:2.00%7
Monthly fees: None2
The High-Yield Chime Savings Account is a great online savings account that does your saving for you. With the Round Up Transfer and Save When I Get Paid features, you can completely forget about your saving and still make progress toward your goals. Round Ups will send the spare change from your purchases right to your savings^ and Save When I Get Paid lets you transfer up to 10% of each direct deposit of $500 or more to your savings account 1. A Chime Checking Account is required to be eligible for a Savings Account.
This account charges no maintenance fees and has no minimum deposit or balance requirements. Check out Chime checking if you like the idea of saving and banking in one place with a platform that’s easy to use*.
Read our full review.
* Chime is a financial technology company, not a bank. Banking services provided by The Bancorp Bank, N.A. or Stride Bank, N.A., Members FDIC. ^ Round Ups automatically round up debit card purchases to the nearest dollar and transfer the round up from your Chime Checking Account to your savings account. 1 Save When I Get Paid automatically transfers 10% of your direct deposits of $500 or more from your Checking Account into your savings account. 2 There’s no fee for the Chime Savings Account. Cash withdrawal and Third-party fees may apply to Chime Checking Accounts. You must have a Chime Checking Account to open a Chime Savings Account. 7 The Annual Percentage Yield (“APY”) for the Chime Savings Account is variable and may change at any time. The disclosed APY is effective as of November 17, 2022. No minimum balance required. Must have $0.01 in savings to earn interest.
Capital One 360 Performance Savings Account
Features
Minimum balance: $0
Minimum deposit: $0
APY:3.00%
Monthly fees: None
Opening a Capital One 360 Performance Savings account might be the way to go if you’re looking to automate your saving with a familiar consumer bank. This account pays the same interest rate of 3.00% on all balances and doesn’t costanything to open. To stay on track with your saving, you can schedule recurring transfers from a Capital One or external account.
If you already have an account with Capital One, you’ll be able to make quick transfers from the app. Finally, there are Capital One branches and ATMs all over the country if you like the option of banking in person.
Open a Capital One savings account or read our full review.
Marcus Online Savings Account
Features
Minimum balance: $0
Minimum deposit: $0
APY:2.50%
Monthly fees: None
Marcus by Goldman Sachs is an online-only bank owned by investment company Goldman Sachs. A Marcus Online Savings Account is ideal for people who want control over their savings and like to strategize different ways to grow their money. This account offers a variety of tools and extensive research to help you make informed decisions with your savings and track your progress. You can even see exactly how much interest you’ve earned from the app.
You’ll earn 2.50% regardless of your balance and there’s no minimum deposit.
Open a Marcus savings account or read our full review.
What is a high-yield savings account?
A high-yield savings account offers a higher yield than traditional savings accounts. How much higher completely depends on the market and the institution, but may be as much as ten or fifteen times the average. You might also hear the term high-interest savings account used — this is the same thing.
Right now, the national average interest rate on a savings account is 0.37%, according to the Federal Deposit Insurance Corporation or FDIC. The FDIC determines rate caps each month using the average interest rates for savings accounts, checking accounts, money market accounts, and certificates of deposit across all banks and credit unions.
How savings account interest works
There are two different ways interest can work with high-yield accounts. The first is to earn a variable interest rate and the second is to earn a tiered interest rate.
A high-yield savings account with a variable rate will pay the same interest rate on any balance. A savings account that uses a tiered interest structure will determine your rate based on your average balance and pay you according to which balance tier you fall into.
With a tiered interest rate, you often earn more interest the higher your balance is. This is to incentivize people to keep more money in their accounts. With a variable interest rate, it doesn’t matter what your balance is as long as you meet the minimum balance requirements (if there are any).
To make things a little more confusing, sometimes a bank or credit union will use a tiered interest rate structure but make the interest rate the same for every balance tier. All interest rates for online savings accounts are subject to change at any time.
Before you apply for an account, find out what rate you’ll qualify for with your balance and activity. Don’t get tricked into opening a high-yield savings account for the great interest rate unless you know you’ll actually earn that rate.
For example, a bank may advertise a high-yield savings account with an interest rate of 3.00% APY, but this rate only applies to balances over $15,000. The difference between the highest and lowest interest rates can be significant, so make sure you don’t get stuck with a lousy rate.
Read more: How to get the best savings account interest rate
What is the annual percentage yield (APY)?
Annual percentage yield is the rate of return you will earn calculated as a percentage of your savings account balance. You’ve probably noticed that the APY on an account is very slightly different from the interest rate. This is because the interest rate only shows simple interest.
The annual percentage yield or APY shows how much interest you can earn each year if you don’t take any of your money out. We like to look at the annual percentage yield rather than just the interest rate because it factors in compounding interest.
To estimate how much you can earn on a high-interest savings account, multiply the APY by your balance to see how much your account will grow if you don’t touch it.
When is interest calculated?
Interest may be calculated daily, weekly, or monthly for a savings account. This is how often your balance is used to determine how much interest you’ve earned.
This frequency can affect your earnings, and daily calculation is the best-case scenario. This is because the more frequently interest is calculated, the higher your balance will be each time it happens thanks to the interest you’ve already been paid. Interest you earn on interest is referred to as compound interest.
For example, a $1,000 balance earning a 1% interest rate pays you $10 in simple interest over a year. If interest is calculated daily, that $10 becomes $10.05 a year.
Read more: Savings interest calculator
Is interest taxed?
Yes, the interest you earn from your savings account will be taxed alongside your income, no matter how much money you bring in.
How to open a high-yield savings account
The basic process for opening a savings account is pretty much the same anywhere you go.
First, you’re going to provide some personal details including your basic contact information. Once your account has been approved, you’ll choose a funding option. Your options might be:
ACH transfer
Wire transfer
Direct deposit
Check deposit (paper or mobile)
Cash deposit
You need to meet minimum opening deposit requirements for your account when funding. Some banks will let you open a savings account without making a deposit right away. Just make sure you know the rules for your chosen account.
If you already have an account with the bank or credit union you’ve chosen, you can link this with your new savings account either before or after funding. This will allow for easy transfers in the future.
How to use a high-yield savings account
There’s a difference between just having a high-yield savings account and using it for all its worth. Here are some ways to make the most of high-interest savings.
Emergency fund
A high-yield savings account is the perfect place to keep your emergency fund. We recommend you have one savings account where you keep at least six months of your monthly living expenses, completely separate from the rest of your cash. You can take the money out if you get sick, lose your income, or face a large unexpected expense, and your balance will grow until then.
Short-term saving
A high-interest savings account is also a great place to save for short-term goals when you don’t want to put your money on the line with higher-risk investments. These accounts are safe and liquid, so your money is there when you’re ready for it and earning interest when you’re not.
For example, if you’re saving money to buy a new car or for your wedding in the next couple of years, you may be able to get a higher rate of return by investing in a mutual fund or other securities. But in such a short period of time, you may lose money. Investments are best for savings goals more than a few years away. For shorter-term goals, savings accounts are safer.
No matter what you’re saving for, a good rule of thumb is to save as often as possible and think about it as little as possible. If you rely on yourself to remember or feel like putting away money to save, you might have more trouble meeting your goals and start feeling frustrated when you don’t see your balance go up. Instead, take advantage of features that do the work for you. To save automatically, you can:
Set recurring transfers
Split your paycheck
Use booster features like roundups
Read more: The best place for short-term savings
What is the withdrawal limit for savings accounts?
Most savings accounts limit the number of withdrawals you’re allowed to make. This started with Federal Regulation D.
Federal Regulation D was a rule that limited the number of withdrawals or transfers that could be made from a savings account to six per month. This included withdrawals made in person, by phone, online, or through any other type of electronic transfer. If you made more than six transfers or withdrawals in a month, your bank might have charged you an excessive withdrawal fee or closed your account.
In April 2020, Regulation D was suspended, but many banks still choose to restrict transactions and enforce the same penalties.
What to look for in a high-yield savings account
There are certain standout features that can immediately make or break a high-yield savings account.
Here are the main things to pay attention to when shopping for a savings account.
Minimum balance requirements
How much do you realistically plan to save? This is the first question you should ask yourself before signing up for an account. Many savings accounts have minimum balance requirements, and you won’t be doing yourself any favors if you open an account and can’t meet these.
If your account does have balance requirements, you must meet them in order to:
Avoid monthly maintenance fees
Earn interest
Keep your account
Your balance at the end of each day is used to determine if you’re meeting requirements. If you’re not, you might be penalized.
Not all high-yield savings accounts have minimum balance requirements. Especially for online savings accounts, it’s becoming more common to not have any.
Read more: How much money should you save each month?
Minimum deposit requirements
Some banks may require you to make a certain minimum deposit when signing up for your account. Failure to do so may disqualify you from opening an account or result in a fee.
A minimum deposit requirement could be anywhere from $5 to $500. Sometimes minimum deposit and minimum balance requirements are the same, and sometimes not. It’s not uncommon for a bank to have a minimum deposit requirement but no minimum balance requirement or vice versa.
Many high-yield online savings accounts have very low or no minimum deposit requirements.
Interest and APY
You’re naturally going to gravitate toward accounts with the highest interest rates, right? That’s free money that you don’t have to work for. But be sure to pay attention to the requirements to earn interest too, not just the annual percentage yield.
For example, if a bank requires you to maintain a balance you can’t maintain to earn interest, it’s probably not the right bank for you. For your first savings account, you might prefer a variable interest rate over a tiered interest rate so you don’t have to worry about if your balance is high enough to earn interest.
Some banks also reserve their best interest rates for preferred customers. This might mean you need to have another account such as a checking account or loan to qualify for the highest APY, and that might be more trouble than it’s worth.
Monthly fees
Some banks still charge monthly maintenance fees on savings accounts, but many don’t. When your goal is to earn money on your savings, monthly fees you get charged just for having an account can really get in the way.
While you should generally look for accounts that don’t charge fees, you might make an exception if a bank offers a waiver. For example, the fee may be waived if you maintain a certain minimum balance in your account for each statement cycle or make a recurring transfer from another account.
If you feel like you can easily meet the requirements to waive a fee and an account is otherwise a perfect fit, go for it.
Cash access
Most people try to ignore the money in their high-yield savings account when they can to take advantage of compound interest.
But life happens, and sometimes you need to dip into your savings. When that happens, you should have convenient access to your money. You might be able to make a withdrawal via:
ACH transfer
Cash withdrawal
ATM withdrawal
Most savings accounts give you the option to make a transfer from your savings to a linked checking account. This checking account can either be with the same bank or another one entirely. If with the same bank, transfers may be instant.
Some banks also offer ATM cards with high-yield savings accounts, though you may incur a fee for ATM transactions. You can also make cash withdrawals at branch locations.
Any transfers or withdrawals you make will count toward your monthly transaction limit.
Mobile apps
Almost every bank out there offers a mobile app today, but some are far better than others. As you’re researching the features of an account, always look into the app too.
Saving from your phone only works when an app does what it’s supposed to, so functionality and convenience are important. You should be able to easily access your savings account, initiate transfers, and see your balance at any time. Those are the basics. You might also want an app that will let you make mobile check deposits, create savings goals, and chat with customer support when there’s an issue.
As a rule, online banks and larger institutions tend to have the best mobile apps. But while you might be looking for an app that’s simple and straightforward to use, someone else might prefer a robust app with educational resources, features, and a variety of notifications. Check out some customer reviews to see what real users have to say about their experiences.
Sign-up bonus
Many banks and credit unions offer sign-up bonuses when you open a high-yield savings account. These offers change all the time and can be quite enticing. For example, bonuses up to $200 are not uncommon. But while sign-up bonuses are nice, they’re not more important than interest rates, fees, and minimums.
Also, be aware that sign-up bonuses come with restrictions. Typically, you’ll need to maintain a certain minimum balance for a set amount of time to qualify. This may be six months or even longer. If your account balance drops below the minimum requirement at any time during the first six months, you may forfeit the bonus. Many bonuses also come with direct deposit requirements.
If you do qualify, you probably won’t get the bonus right away and may have to wait several weeks. All this to say that sign-up bonuses aren’t a good option for getting quick cash. Consider these after all of the other features we’ve outlined.
Are high-yield savings accounts safe?
Your money can’t get a lot safer than it is when it’s in a savings account.
Almost all savings accounts with banks are protected by the Federal Deposit Insurance Corporation (FDIC) and insured for up to $250,000 per depositor. This insurance coverage protects your money in the event that your bank loses money and is unable to repay its deposits. Almost all savings accounts with credit unions are protected by the National Credit Union Administration (NCUA) for up to $250,000 per depositor. This provides the same protections.
If a bank or credit union is not FDIC- or NCUA-insured, you may qualify for private deposit insurance.
Benefits of online savings accounts
High-yield savings accounts and online savings accounts are often one and the same. Here are some of the top benefits you can expect from an online savings account.
Higher interest
A traditional savings account with your bank or credit union might seem like the best choice, but you can do a lot better. Compared to traditional accounts, online savings accounts tend to offer much better interest rates, plus benefits like fewer fees, extra savings features, and the convenience of opening and managing your account completely online (or from your phone).
Online savings accounts can pay higher interest rates because digital accounts are cheaper to operate, lowering a bank’s costs and passing on the savings to you in the form of better interest.
Fewer fees
Online savings accounts almost always have lower fees than traditional savings accounts for the same reasons they can offer better rates. Many charge no monthly fees at all.
Avoiding monthly fees like maintenance fees, low balance fees, and inactivity fees can save you serious money in the long run. Plus, let you actually keep the interest you’ve earned.
Convenience
Online savings accounts are much more convenient to open and use. You can open your account online and fund it by just transferring the money from another account. Usually, all of this takes less than five minutes.
An online account lets you make deposits, transfer money, pay bills, and see your account activity at any time without the need for a phone call or visit to the bank. You can even view your account statements and track your progress. If you’re not a fan of brick-and-mortar branches, an online savings account either with a fully-digital bank or a hybrid bank could be perfect for you.
Perks and benefits
Online savings accounts tend to come with a lot of great, free features. Automatic transfers into your savings account from your checking account, mobile check deposit, and account alerts are just a few common ones.
Some online savings accounts go above and beyond this. They might offer savings support like boosters and automated tools, help you create a saving strategy with resources and insights, or the option to organize your savings into separate buckets or categories.
Read more: Best online savings accounts
Disadvantages of savings accounts
Although a great tool for saving for your future and protecting your finances, savings accounts in general do have limitations. Let’s talk about some of those here.
Limited withdrawals
One of the main disadvantages of high-yield savings accounts is limited cash access. A lot of this has to do with withdrawal restrictions.
Remember, you’re often restricted to just six transactions per statement period with a savings account. This is a limit that was originally set by the federal government that many accounts still stick to. You shouldn’t use your savings account as a secondary spending account because when you hit that limit, you risk losing the account. This is why savings accounts should be for money you don’t immediately need.
If you’re looking for a place to set aside some extra money you do plan to dip into regularly, consider a high-yield checking account instead of a savings account. While the rates for high-yield checking accounts aren’t usually as good as the rates for high-yield savings accounts, you’ll have more flexibility to spend your money.
Read more: Best high-yield checking accounts compared
Rates can change at any time
Another downside to savings accounts is that the interest rates are always variable. This means the rate you earn on your balance can change at any time, and it definitely will as the market fluctuates. It’s important to remember that you’re not locked into the annual percentage yield you sign up for when you open a high-yield savings account.
And if the rate does change, your bank doesn’t have to give you any sort of warning. Although competitive high-yield savings accounts will, for the most part, stay competitive and continue offering the highest yields compared to other accounts, there’s no telling how much you’ll earn in dividends a year from now.
You should choose a high interest rate but know that it can change and don’t rely on the dividends for income.
Security risks
With any type of financial account, there are going to be certain safety concerns. While these are really minimal with an insured savings account, you can take steps to maximize your personal security.
If an account offers multi-factor authentication, set it up (it’s free anyway). If you have the option to enroll in fraud protection, do it. Set up account alerts to notify you about suspicious activity and check your balance often to make sure everything looks good.
FDIC and NCUA protection will keep you safe from losing all of your money if your bank goes bankrupt, but it’s your responsibility to make sure your account is as safe as it can be from hackers.
Read more: How to make online banking more secure
Are high-yield savings accounts worth it?
The answer to this question is probably, but it really depends on what kind of account you choose. We’ll say it again, we always prefer an online savings account with no minimums and no fees. Even if you can’t yet afford to set much money aside, you can start earning a small amount of interest on your balance and setting those good savings habits with free accounts.
But if you open a savings account that charges monthly maintenance fees, overdraft fees, low balance fees, etc., you’re going to have to work harder to make the account worth it. Keep in mind that all of these fees can eat into and even exceed your interest earnings, causing you to lose money in the long run.
So basically, as long as you don’t make the mistake of choosing the wrong account and letting it drain your earnings, you have nothing to lose.
High-yield savings accounts vs. money market accounts (MMAs)
Which is the better option for your money right now: a high-yield savings account or a money market account?
A money market account or MMA is a special type of savings account. They typically have higher balance requirements to earn interest but may offer better interest rates than high-yield savings accounts. Usually, MMAs pay tiered variable interest rates so the more you save, the more you earn.
MMAs often come with higher fees, higher deposit requirements, and higher balance requirements than savings accounts. While they can earn more depending on the interest rate environment, right now the best rates are really comparable between high-yield savings accounts and MMAs.
Savings accounts and money market accounts have the same transaction limit of six per statement period.
Read more: 9 best money market accounts
High-yield savings accounts vs. certificates of deposit (CDs)
A certificate of deposit or CD is a type of deposit account that usually offers a fixed interest rate for a fixed term. This means that the amount of money you earn on your deposits is guaranteed for the length of the CD term.
CD terms can range from as little as one month to as much as 10 or even 20 years. During the term of the CD, you agree not to withdraw any of the money you’ve deposited. If you do need to access your money before the end of the term, you’ll pay an early withdrawal penalty fee.
Early withdrawal fees are equal to the interest you earn for a set number of days or months. For example, you may pay three months’ interest for taking money out of a one-year CD early.
Because of early withdrawal fees, you risk losing your interest in a CD, so you should only deposit money you’re absolutely certain you won’t need until the term is up.
Stick with a savings account until you have an emergency fund built up before you consider a CD. CDs can be better vehicles for long-term saving but they should not replace your emergency savings account.